/raid1/www/Hosts/bankrupt/TCR_Public/130325.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, March 25, 2013, Vol. 17, No. 83
Headlines
1717 MARKET: Regions Bank Wins Chapter 11 Case Dismissal
22ND CENTURY: Incurs $6.7 Million Net Loss in 2012
30DC INC: Delays Form 10-Q for Dec. 31 Quarter
ABDIANA A: Full-Payment Plan Confirmed by Judge
ACCELPATH INC: Delays Form 10-Q for Dec. 31 Quarter
ALLIED SYSTEMS: Creditors and Black Diamond Can Sue Yucaipa
ALLY FINANCIAL: To Sell Servicing Rights to Quicken for $280MM
AMBAC FINANCIAL: Posts $143.3 Million Net Gain in 4th Quarter
AMERICAN AIRLINES: Seeks Approval of BNY Mellon Agreement
AMERICAN AIRLINES: Eagle Keeps Northwest Arkansas Airport Lease
AMERICAN AIRLINES: Proposes Sale & Leaseback of 11 Boeing Planes
AMERICAN AIRLINES: Ryan Seeks $3.2-Mil. for Fla. Tax Review
AMERICAN AIRLINES: Pilots, Committees Support US Airways Merger
AMERICAN RESOURCES: A.M. Best Upgrades FSR to 'B'
ANACOR PHARMACEUTICALS: E&Y LLP Raises Going Concern Doubt
APEX KATY: Chapter 11 Case Dismissed as Payment Deal Okayed
APPLETON PAPERS: Incurs $148.4 Million Net Loss in Fiscal 2012
APPLIED MINERALS: Incurs $9.7 Million Net Loss in 2012
ARCAPITA BANK: Court Extends Plan Exclusivity Until April 10
AS SEEN ON TV: Delays Form 10-Q for Dec. 31 Quarter
AS SEEN ON TV: Amends Services Agreement with Kevin Harrington
AS SEEN ON TV: Appoints Ronald Pruett as President and CEO
ASPEN GROUP: Incurs $6 Million Net Loss in 2012
ASSURED PHARMACY: Jack Brooks Holds 36% Equity Stake at Feb. 5
AVID TECHNOLOGY: Gets NASDAQ Listing Non-Compliance Notice
B&T OLSON: Has Court's Nod to Continue Using Cash Collateral
BEALL CORP: PSC Custom Bags Parts and Services Biz. for $4.25MM
BEARINGPOINT INC: Liquidating Trust Settles Suit v. Ex-Directors
BELFOR HOLDINGS: Moody's Rate New $170MM Revolver Debt 'Ba3'
BEST UNION: Has Access to Cash Collateral Until June 30
BG MEDICINE: Incurs $23.8 Million Net Loss in 2012
BIOCORAL INC: Delays Financials for Year Ended Dec. 31, 2012
BROADCAST INTERNATIONAL: Mark Spagnolo Quits as Director
CAESARS ENTERTAINMENT: Amends 2012 Annual Report
CARY CREEK: Court Okays Northen Blue as Bankruptcy Counsel
CARY CREEK: Has Nod to Keep Affiliate AAC as Property Manager
CARY CREEK: Has OK to Hire Bidencope & Associates as Appraiser
CARY CREEK: Has Court Okay to Hire Rayburn as Litigation Counsel
CASTAIC PARTNERS: Case Dismissed, to Pay U.S. Trustee Fees
CAVE LAKES: Has No More Assets; Reorganization Case Dismissed
CEDAR BAY: S&P Assigns Prelim. 'BB' Rating to $250MM Senior Debt
CENGAGE LEARNING: S&P Cuts CCR to 'CCC-' on Weak Performance
CENTRAL EUROPEAN: Cancels Exchange Offer Amid Roust Deal
CHAMPION INDUSTRIES: Incurs $3.5 Million Net Loss in 1st Quarter
CHARLES STREET: Bank Seeks Dismissal of Chapter 11 Case
CHILE MINING: Delays Financials for Dec. 31 Quarter
CHINA EDUCATION: Gets SEC Letter Over Auditor Non-Compliance
CIRCLE STAR: Incurs $1.5 Million Net Loss in Jan. 31 Quarter
CLUB AT SHENAND: Proofs of Claims Due April 29
CMS ENERGY: Fitch Rates $250MM Senior Unsecured Notes 'BB+'
COMMUNITY FIRST: Reports $3 Million Net Income in 2012
COMSTOCK MINING: Incurs $30.7 Million Net Loss in 2012
CONTRACTOR TECH: Porter Hedges Dodges $1M Client Conflict Suit
COPYTELE INC: Incurs $2.1 Million Net Loss in Jan. 31 Quarter
CORRECTIONS CORP: Fitch Rates New $675MM Unsecured Notes 'BB+'
CORRECTIONS CORP: Moody's Affirms 'Ba1' Senior Debt Rating
CORRECTIONS CORP.: S&P Ups CCR to BB+; Rates New Unsec. Notes BB+
CROWN MEDIA: Moody's Rates New $30MM Revolver Debt 'Ba2'
CUMULUS MEDIA: Incurs $32.7 Million Net Loss in 2012
CPI CORP: BofA Extends Forbearance Agreement Until April 6
CUI GLOBAL: Copies of Line of Credit Docs. with Wells Fargo
DEWEY & LEBOEUF: Ch. 11 Liquidation Plan Takes Effect
DEX ONE: Stockholders OK Amended Plan of Merger with SuperMedia
DUMA ENERGY: Delays Form 10-Q for Jan. 31 Quarter
EAST END: Gets Final OK to Obtain $7.3MM Postpetition Loan
EASTMAN KODAK: Shutterfly Sues Over Photo Book App
EDISON MISSION: Incurs $909 Million Net Loss in 2012
EDISON MISSION: Has Final Approval for Employee Incentive Plan
EDISON MISSION: Court Extends PoJo Forbearance Agreement
EDISON MISSION: Deadline to Remove Actions Extended to Sept. 13
EDISON MISSION: Stay Lifted to Permit Labor Union Arbitration
ELBIT VISION: Incurs $179,000 Loss in Fourth Quarter
ELEPHANT TALK: Delays Form 10-K for 2012
ENERGYSOLUTIONS INC: Reports $3.9 Million Net Income in 2012
ENDEAVOUR INTERNATIONAL: Incurs $126 Million Net Loss in 2012
ENERGY FUTURE: Aurelius Sues Officers and Directors
ENERGY TRANSFER: Moody's Affirms 'Ba2' CFR; Outlook Stable
ENTERTAINMENT PUBLICATIONS: Draws Bid From Founders' Son
ENVIRONMENTAL SOLUTIONS: Incurs $1.4-Mil. Net Loss in 2012
ERF WIRELESS: Names Seasoned CEO/CFO to Board of Directors
FANNIE MAE: Delays 2012 Annual Report for Further Analysis
FIFTH THIRD BANCORP: DBRS Hikes Preferred Stock Rating to 'BB'
FLAT OUT: Court Approves March 29 Auction of Flat Top's Assets
FR 160: Court OKs Expansion of Snell & Wilmer Employment
FR 160: Can Tap Osborn Maledon & Moyers Sellers as Special Counsel
FREDERICK'S OF HOLLYWOOD: Had $9.8MM Net Loss in Jan. 26 Quarter
FRONTIERS MEDIA: Magazine Publisher Wins Interim Cash Use
FUESTREAM INC: Amends 397,218 Shares Resale Prospectus
GATEWAY HOTEL: Court Terminates Chapter 11 Case
GEOKINETICS INC: Terminates Registration of Securities
GEOKINETICS INC: Seeks OK for E&Y as Tax Advisor
GGW BRANDS: Wynn Las Vegas Wants Trustee to Take Over Ch. 11
GOLDEN GUERNSEY: Secures $5.5M Stalking Horse Bid
GOOD SAM: Posts $9.4 Million Net Income in 2012
GORDON PROPERTIES: March 26 Hearing Set on Additional Borrowing
GREEN EARTH: Amends 55 Million Common Shares Prospectus
H&M OIL: Trustee Can Hire PLS Inc. as Marketing Agent
H&M OIL: Court OKs Russell K. Hall as Trustee's Reserve Engineers
HANOVER INSURANCE: Fitch Rates $175MM Subordinated Debt 'BB'
HANOVER INSURANCE: S&P Rates New Subordinated Debentures 'BB'
HAWAII OUTDOOR: Hearing on Further Use of Cash Today
HEALTHWAREHOUSE.COM INC: L. Dhadphale Holds 25% Stake at Feb. 1
HEALTHWAREHOUSE.COM INC: Cape Bear Holds 8% Stake at Feb. 1
HORIZON LINES: Incurs $17.9 Million Net Loss in Fourth Quarter
HORIZON PHARMA: Incurs $87.8-Mil. Net Loss in 2012
HOST HOTELS: Fitch Rates $400MM Series D Senior Notes 'BB+'
HOWREY LLP: Trustee Slams Latest Bid to Sue Equity Holders
HRK HOLDINGS: Has $1.2-Mil. in Add'l Financing From Regions Bank
HUDSON HEALTHCARE: Trustee Blames Losses on Exec Negligence, Fraud
INDIANAPOLIS DOWNS: Plan Confirmed; Reconsideration Sought
INSPIRATION BIOPHARMACEUTICALS: Sale of Hemophilia Completed
INSPIREMD INC: Receives CE Mark Approval for Carotid EPS
INTELLIPHARMACEUTICS INT'L: Keppra Accepted by FDA for Filing
ISTAR FINANCIAL: Has 3.5MM Shares Underwriting Pact with Barclays
ISTAR FINANCIAL: PointState Capital Has 6.5% Stake at March 5
IZEA INC: Converts $550,000 of Debt Into Common Stock
J.C. PENNEY: Default Notice Withdrawal No Impact on 'B3' CFR
JEFFERSON COUNTY: Mediation Required on Sewer Expense Appeal
JEWISH COMMUNITY: Withdraws Motion to Hire Realtor
JOURNAL REGISTER: Approved to Sell Assets in Bankruptcy Court
JOURNAL REGISTER: Opinion on Sale Helps Union Workers
LAGUNA BRISAS: April 9 Combined Hearing on Plan, Outline Set
LAUSELL INC: FirstBank Withdraws Motion for Case Dismissal
LDK SOLAR: EVP and Director Quits for Personal Reasons
LEHMAN BROTHERS: Nevada Board of Finance Refuses to Settle
LEHMAN BROTHERS: Suit Over $1.4-Bil. Assured Guaranty Fee Cut
LIBERTY MEDICAL: Meeting of Creditors Scheduled for March 27
LIFECARE HOLDINGS: Seeks Exclusivity Even If Plan Unlikely
MAUI LAND: Cuts Number of Directors to Five
MBIA INC: Moody's Reviews Caa1 Senior Debt Rating for Downgrade
MCCLATCHY CO: Chou Associates No Longer Owns Shares at Dec. 31
MERISEL INC: Amends Current Report on Form 8K/A
MERRIMACK PHARMACEUTICALS: Incurs $24.9MM Loss in 4th Quarter
METROGAS SA: Incurs ARS142.8-Mil. Net Loss in 2012
MGM RESORTS: Tracinda Plans to Purchase Additional Shares
MICHAELS STORES: Reports $214 Million Net Income in Fiscal 2012
MMODAL INC: S&P Lowers CCR to 'B' on Slow Revenue Growth
MORGANS HOTEL: OTK Associates Nominates Seven Directors
MUSCLEPHARM CORP: Company Presentation for March 2013
NAVISTAR INTERNATIONAL: Fitch Affirms 'CCC' Issuer Default Rating
NEONODE INC: Incurs $9.3 Million Net Loss in 2012
NUVILEX INC: MMS Incorporated in Nevada State
NUVILEX INC: Delays Jan. 31 Form 10-Q for Review
OCEAN DRIVE: Assets Sold to Grand Heritage Int'l
OMEGA NAVIGATION: Creditors Voting on 2.5% to 4% Plan
ORAGENICS INC: Board OKs up to $140,000 Bonus for CEO in 2013
ORMET CORP: Melts Opposition to $90M DIP Financing
OVERLAND STORAGE: Registers 14.5 Million Common Shares
OVERSEAS SHIPHOLDING: Files Schedules of Assets and Liabilities
OVERSEAS SHIPHOLDING: Enters Truce with BP In Venture Fight
OXFORD RESOURCE: 2012 10-K to be Delayed; Expects $26.1MM Net Loss
PARKERVISION INC: Incurs $20.3-Mil. Net Loss in 2012
PATIENT SAFETY: Incurs $2.2 Million Net Loss in 2012
PATRIOT COAL: Peabody Objects to Retiree Panel's Rule 2004 Motion
PATRIOT COAL: Retiree Committee Retaining Stahl Cowen as Counsel
PATRIOT COAL: Creditor Ohio Valley Coal Opposes Rejection Motion
PENSON WORLDWIDE: To Sell to Caisses as No Other Bids Filed
PENSON WORLDWIDE: Grace Fin'l. Wants Stay Lifted to Pursue Claims
PEREGRINE FINANCIAL: Court OKs Three Classes of Customers
PLYMOUTH OIL: Hearing on Further Access to Cash on March 27
PONCE DE LEON: PRLP Has Until Today to File Plan Stipulation
POWELL STEEL: Has Court OK to Use Cash Collateral Until March 31
PRESSURE BIOSCIENCES: CSS Discloses 3% Equity Stake at Dec. 31
PRECISION OPTICS: Amends Dec. 31 Form 10-Q in XBRL Format
QUICK-MED TECHNOLOGIES: Delays Form 10-Q for Dec. 31 Quarter
RADIAN GUARANTY: Unit Enters Into Partnership with Optimal Blue
READER'S DIGEST: Files Plan; Unsecured Recovery Left Blank
READER'S DIGEST: Creditors Committee Seeks Changes in Loan
READER'S DIGEST: New Money Lenders Defend DIP Financing Terms
READER'S DIGEST: Committee Wants to Hire Otterbourg as Counsel
REID PARK: Files Non-Material Modifications to Fifth Amended Plan
RESIDENTIAL CAPITAL: Stopped From Junking Mortgage Consent Decree
RESIDENTIAL CAPITAL: Ally Expense Allocation Talks Until April 18
RESIDENTIAL CAPITAL: Has Protocol for Challenging 6,400 Claims
RESIDENTIAL CAPITAL: FTI Rollover Provision Extended
RESIDENTIAL CAPITAL: Expands Scope of Deloitte & Touche Work
ROC FINANCE: New $535MM Term Loan Gets Moody's 'B1' Rating
ROTHSTEIN ROSENFELDT: Jeweler Settles to Avoid $10 Million Risk
STOCKTON, CA: Judge Limits Experts at This Week's Trial
TRANS NATIONAL: Blue Casa Buys Telecom Reseller
UNIVISION COMMS: DirecTV Carriage Deal No Impact on 'B3' CFR
VANTIV LLC: S&P Lifts Corp Credit Rating to 'BB+'; Outlook Stable
VITRO SAB: Says Settlement Won't Be Completed Until April
W.R. GRACE: Seeks Bankruptcy Court Approval to Pay Bonuses
WM SIX FORKS: Raleigh Apartment Project Sold in Debt Swap
* Moody's Notes Decline in Number of Companies with Low Ratings
* District Court Affirms Punitive Damages Imposed on Wells Fargo
* Statistics Points Toward Fewer Chapter 11s in 2013
* BOND PRICING -- For Week From March 18 to 22, 2013
*********
1717 MARKET: Regions Bank Wins Chapter 11 Case Dismissal
--------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Missouri
dismissed the Chapter 11 case of 1717 Market Place, L.L.C.
Regions Bank asked that the Bankruptcy Court to reconsider its
order dated March 7, 2013, denying Region's motion to dismiss or
convert the Debtor's case and giving the Debtor until May 22 to
refinance the Regions Bank's Indebtedness with Empire Bank.
Regions Bank reasserted that immediate dismissal of the case is
proper to avoid further costs and prejudice to the only real
creditor of Debtor in the case, Regions Bank.
Regions Bank pointed out that Richard Gregg (the lead principal of
the Debtor) had been arrested for 17 counts of fraud, including
four counts of bank fraud, 10 counts of money laundering, two
counts of wire fraud and one count of bankruptcy fraud related to
the case. Although Mr. Gregg was arrested on his entrance into
the Bankruptcy Court prior to the March 6, hearing, the Debtor's
counsel (if he knew) failed to inform the Court of Mr. Gregg's
arrest.
About 1717 Market Place
1717 Market Place LLC, a grocery-store business, filed for
Chapter 11 protection (Bankr. W.D. Mo. Case No. 12-00984) on
July 17, 2012, in Springfield, Missouri. The Debtor estimated
assets and liabilities of at least $10 million. G&S Holdings LLC
owns 98% of the company and the remaining 2% is owned by J. Scott
Schaefer and Richard T. Gregg, according to court papers.
1717 Market Place said it is a defendant in a lawsuit brought by
Regions Bank in Joplin, Missouri, relating to a promissory note.
The bank is seeking the appointment of a receiver.
David Schroeder Law Offices, P.C., serves as the Debtor's counsel.
Barry Worth of Brown, Smith and Wallace, LLC, was appointed as
examiner. David A. Sosne, Esq., and the law firm of Summers
Compton Wells PC serve as the examiner's counsel.
22ND CENTURY: Incurs $6.7 Million Net Loss in 2012
--------------------------------------------------
22nd Century Group, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing
a net loss of $6.73 million on $18,775 of total revenue for the
year ended Dec. 31, 2012, as compared with a net loss of
$1.34 million on $1.01 million of total revenue during the prior
year.
The Company's balance sheet at Dec. 31, 2012, showed $2.64 million
in total assets, $8.77 million in total liabilities, and a
$6.13 million total shareholders' deficit.
Freed Maxick CPAs, P.C., in Buffalo, New York, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that 22nd Century has suffered recurring losses from operations
and as of Dec. 31, 2012, has negative working capital of
$3.3 million and a shareholders' deficit of $6.1 million.
Additional capital will be required during 2013 in order to
satisfy existing current obligations and finance working capital
needs as well as additional losses from operations that are
expected in 2013.
A copy of the Form 10-K is available for free at:
http://is.gd/P21m6l
About 22nd Century
Clarence, New York-based 22nd Century Group, Inc., through its
wholly-owned subsidiary, 22nd Century Ltd, is a plant
biotechnology company using technology that allows for the level
of nicotine and other nicotinic alkaloids (e.g., nornicotine,
anatabine and anabasine) in tobacco plants to be decreased or
increased through genetic engineering and plant breeding.
30DC INC: Delays Form 10-Q for Dec. 31 Quarter
----------------------------------------------
30DC, Inc., said it was unable without unreasonable effort and
expense to prepare its accounting records and schedules in
sufficient time to allow its accountants to complete their review
of the Company's financial statements for the period ended
Dec. 31, 2012, before the required filing date for the subject
quarterly report on Form 10-Q. The Company intends to file the
subject quarterly report on Form 10-Q on or before the 60th
calendar day following the prescribed due date.
30DC previously disclosed delayed filings of its financial
statements for the quarter ended June 30, 2012 and the fiscal year
ended Sept. 30, 2012.
About 30DC Inc.
New York-based 30DC, Inc., provides Internet marketing services
and related training to help Internet companies in operating their
businesses. It operates in two divisions, 30 Day Challenge and
Immediate Edge.
The Company reported a net loss of $1.44 million for the fiscal
year ended June 30, 2011, following a net loss of $1.06 million in
fiscal 2010.
As reported in the TCR on Dec. 19, 2011, Marcum LLP, in New York,
expressed substantial doubt about 30DC's ability to continue as a
going concern, following the Company's results for the fiscal year
ended June 30, 2011. The independent auditors noted that the
Company has had recurring losses, and has a working capital and
stockholders' deficiency as of June 30, 2011.
The Company's balance sheet at March 31, 2012, showed $1.82
million in total assets, $2.21 million in total liabilities and a
$394,450 total stockholders' deficiency.
The Company said in its quarterly report for the period ending
March 31, 2012, that if it is unable to raise additional capital
or encounters unforeseen circumstances, it may be required to take
additional measures to conserve liquidity, which could include,
but not necessarily be limited to, issuance of additional shares
of the Company's stock to settle operating liabilities which would
dilute existing shareholders, curtailing its operations,
suspending the pursuit of its business plan and controlling
overhead expenses. The Company cannot provide any assurance that
new financing will be available to it on commercially acceptable
terms, if at all. These conditions raise substantial doubt about
the Company's ability to continue as a going concern.
ABDIANA A: Full-Payment Plan Confirmed by Judge
-----------------------------------------------
Abdiana A, LLC, won confirmation of its Chapter 11 plan
reorganization plan. The plan provides that all allowed claims
will be paid in full, although payments would be made in
installments after the effective date.
The plan specifically provides that:
* Class 1 -- the Claim of Arvest Bank in the total amount of
$9,800,000, secured by a lien on Debtor's real property -- will be
paid on a 25-year amortization with interest at the rate of 4.5%
per annum, with payment of excess cash flow and a balloon payment
after five years;
* Class 2 -- the secured Claim of Kansas City Power and Light
Company in the sum of $4,866 -- will be paid on a five-year
amortization with interest at the rate of 3.25% per annum;
* Class 3 -- the secured Claim of Missouri Gas Energy in the
sum of $250 -- will be paid in full within 60 days after the
Effective Date; and
* Class 4 -- consists of general unsecured Claims in the
amount of $27,838.50 -- will be paid in monthly installments on a
five-year amortization with interest at the rate of 3.25% per
annum.
* The holder of 100% membership interest in the Debtor will
retain its equity interest in the Reorganized Debtor equal to the
member interest it held in the Debtor pre-Petition.
About Abdiana A LLC
Abdiana A, LLC, filed for Chapter 11 bankruptcy (Bankr. W.D. Mo.
Case No. 12-44005) on Sept. 25, 2012, estimating at least
$10 million in assets and debts.
Abdiana A owns and operates various real properties in Kansas
City, Missouri:
* 318 E. 10th St., Kansas City, Missouri 64108;
* 620 E. 18th St., Kansas City, Missouri 64108;
* 1726 Holmes, Kansas City, Missouri 64108;
* 1917 McGee St., Kansas City, Missouri 64108;
* 2001 Grand Ave., Kansas City, Missouri 64108;
* 2547 Cherry St., Kansas City, Missouri 64108; and
* 7100 - 7140 Wornall Rd., Kansas City, Missouri 64114
All of the parcels are subject to deeds of trust in favor of
Arvest Bank.
The Debtor sought bankruptcy protection to halt foreclosure
efforts by Arvest. The Debtor had encountered financial problems
after a tenant in the property 1726 Holmes, which had been paying
rent of roughly $55,000 per month as a tenant of the Debtor's
predecessor, breached the lease and ceased paying rent.
Bankruptcy Judge Arthur B. Federman oversees the case.
Arvest Bank is represented by Bryan Cave LLP.
ACCELPATH INC: Delays Form 10-Q for Dec. 31 Quarter
---------------------------------------------------
Due to AccelPath, Inc.'s limited financial and management
resources, the preparation and filing of the 10-Q for the period
ended Dec. 31, 2012, was delayed.
About AccelPath
Gaithersburg, Md.-based AccelPath has two primary businesses:
AccelPath, LLC, and Digipath Solutions, LLC, are in the business
of enabling pathology diagnostics and Technest, Inc. (a 49% owned
subsidiary) is in the business of the design, research and
development, integration, sales and support of three- dimensional
imaging devices and systems.
The Company had a working capital deficit of $2.2 million and a
stockholders' deficit of $504,078 at Sept. 30, 2012.
As reported in the TCR on Oct. 18, 2012, MaloneBailey, LLP, in
Houston, Texas, expressed substantial doubt about AccelPath's
ability to continue as a going concern following their audit of
the Company's financial statements for the year ended June 30,
2012. The independent auditors noted that the Company has
suffered recurring losses from operations, has negative cash flows
from operations, a stockholders' deficit and a working capital
deficit.
ALLIED SYSTEMS: Creditors and Black Diamond Can Sue Yucaipa
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that creditors of Allied Systems Holdings Inc. were given
permission from the bankruptcy judge in Delaware to sue the auto
hauler's controlling shareholder Yucaipa Cos.
According to the report, the lawsuit by the official creditors'
committee contains a laundry list of claims. Among them, the
creditors contend that debt held by Yucaipa should be treated as
equity or subordinated so everyone else is paid before the Los
Angeles-based owner. The committee said it has other claims for
breach of contract, breach of fiduciary duty, and receipt of
preferential and fraudulent transfers. According to the
creditors, Yucaipa took control over "all facets" of Allied's
"capital structure in an effort to protect its equity investments
and to frustrate the legitimate rights of creditors."
The report notes that Allied has been in bankruptcy reorganization
for 10 months. The company said it can't propose a Chapter 11
plan because the "major lenders and creditors' committee have not
coalesced around an exit strategy." The bankruptcy is being
financed with a $20 million loan from a Yucaipa affiliate.
Allied's new bankruptcy began in May when secured creditors Black
Diamond Capital Management LLC and Spectrum Group Management LLC
filed an involuntary Chapter 11 petition. The bankruptcy judge is
allowing Black Diamond to participate in the lawsuit against
Yucaipa and Allied directors.
About Allied Systems
BDCM Opportunity Fund II, LP, Spectrum Investment Partners LP, and
Black Diamond CLO 2005-1 Adviser L.L.C., filed involuntary
petitions for Allied Systems Holdings Inc. and Allied Systems Ltd.
(Bankr. D. Del. Case Nos. 12-11564 and 12-11565) on May 17, 2012.
The signatories of the involuntary petitions assert claims of at
least $52.8 million for loan defaults by the two companies.
Allied Systems, through its subsidiaries, provides logistics,
distribution, and transportation services for the automotive
industry in North America.
Allied Holdings Inc. previously filed for chapter 11 protection
(Bankr. N.D. Ga. Case Nos. 05-12515 through 05-12537) on July 31,
2005. Jeffrey W. Kelley, Esq., at Troutman Sanders, LLP,
represented the Debtors in the 2005 case. Allied won confirmation
of a reorganization plan and emerged from bankruptcy in May 2007
with $265 million in first-lien debt and $50 million in second-
lien debt.
The petitioning creditors said Allied has defaulted on payments of
$57.4 million on the first lien debt and $9.6 million on the
second. They hold $47.9 million, or about 20% of the first-lien
debt, and about $5 million, or 17%, of the second-lien obligation.
They are represented by Adam G. Landis, Esq., and Kerri K.
Mumford, Esq., at Landis Rath & Cobb LLP; and Adam C. Harris,
Esq., and Robert J. Ward, Esq., at Schulte Roth & Zabel LLP.
Allied Systems Holdings Inc. formally put itself and 18
subsidiaries into bankruptcy reorganization June 10, 2012,
following the filing of the involuntary Chapter 11 petition.
The Company is being advised by the law firms of Troutman Sanders,
Gowling Lafleur Henderson, and Richards Layton & Finger.
The bankruptcy court process does not include captive insurance
company Haul Insurance Limited or any of the Company's Mexican or
Bermudan subsidiaries. The Company also announced that it intends
to seek foreign recognition of its Chapter 11 cases in Canada.
An official committee of unsecured creditors has been appointed in
the case. The Committee consists of Pension Benefit Guaranty
Corporation, Central States Pension Fund, Teamsters National
Automobile Transporters Industry Negotiating Committee, and
General Motors LLC. The Committee is represented by Sidley Austin
LLP.
ALLY FINANCIAL: To Sell Servicing Rights to Quicken for $280MM
--------------------------------------------------------------
Tanya Agrawal and Rick Rothacker, writing for Reuters, reported
that auto lender Ally Financial Inc.'s banking unit said it would
sell its remaining mortgage servicing rights portfolio to online
lender Quicken Loans Inc for about $280 million.
According to the Reuters report, Detroit-based Quicken is buying
collection rights on $34 billion of non-delinquent Freddie Mac
(FMCC.OB) and Fannie Mae (FNMA.OB) mortgages. Quicken, which has
a $90 billion mortgage servicing portfolio, said it would become a
top-10 servicer after the purchase. The transaction is expected
to close in the second quarter and is subject to approvals from
Fannie Mae and Freddie Mac.
Reuters recalled that earlier this month, Ally, the former lending
arm of General Motors (GM.N), said it was selling about $90
billion of mortgage servicing rights (MSR) to Ocwen Financial Corp
(OCN.N). Ally, also based in Detroit, will have no further MSR
assets once it closes the transactions with Ocwen and Quicken.
About Ally Financial
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%.
The Company's balance sheet at Dec. 31, 2012, showed
$182.34 billion in total assets, $162.44 billion in total
liabilities, and $19.89 billion in total equity. Ally Financial
Inc. reported net income of $1.19 billion for the year ended
Dec. 31, 2012, as compared with a net loss of $157 million during
the prior year.
* * *
As reported by the TCR on Feb. 27, 2013, Moody's Investors Service
confirmed the B1 corporate family and senior unsecured ratings of
Ally Financial, Inc. and supported subsidiaries and assigned a
positive rating outlook.
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. In the Feb. 13, 2013,
edition of the TCR, Fitch Ratings has maintained the Rating Watch
Negative on Ally Financial Inc. including the Long-term IDR 'BB-'.
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.
AMBAC FINANCIAL: Posts $143.3 Million Net Gain in 4th Quarter
-------------------------------------------------------------
Ambac Financial Group, Inc., reported a net gain of
$143.30 million on $103.53 million of net premiums earned for the
three months ended Dec. 31, 2012, as compared with a net loss of
$963.19 million on $112.84 million of net premiums earned for the
same period during the prior year.
For the year ended Dec. 31, 2012, the Company incurred a net loss
of $259.35 million on $414.60 million of net premiums earned, as
compared with a net loss of $1.96 billion on $405.97 million of
net premiums earned a year ago.
The Company's balance sheet at Dec. 31, 2012, showed $27 billion
in total assets, $30.25 billion in total liabilities and $3.24
billion total stockholders' deficit.
A copy of the press release is available for free at:
http://is.gd/OxlXOj
About Ambac Financial
Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.
Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No.
10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will
continue to operate in the ordinary course of business as "debtor-
in-possession" under the jurisdiction of the Bankruptcy Court and
in accordance with the applicable provisions of the Bankruptcy
Code and the orders of the Bankruptcy Court.
Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy. AAC is being restructured by state regulators in
Wisconsin. AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.
Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed US$30.05 billion in total assets,
US$31.47 billion in total liabilities, and a US$1.42 billion
stockholders' deficit, at June 30, 2010.
On an unconsolidated basis, Ambac said in a court filing that
it has assets of (US$394.5 million) and total liabilities of
US$1.6826 billion as of June 30, 2010.
Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about US$1.62 billion.
The Blackstone Group LP is the Debtor's financial advisor.
Kurtzman Carson Consultants LLC is the claims and notice agent.
KPMG LLP is tax consultant to the Debtor.
Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel
to the Official Committee of Unsecured Creditors. Lazard Freres
& Co. LLC is the Committee's financial advisor.
Bankruptcy Judge Shelley C. Chapman entered an order confirming
the Fifth Amended Plan of Reorganization of Ambac Financial Group,
Inc. on March 14, 2012. The Plan provides for the full payment of
secured claims and 8.5% to 13.2% recovery for general unsecured
claims.
Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY
NEWS. The newsletter tracks the Chapter 11 proceeding undertaken
by Ambac Financial Group and the restructuring proceedings of
Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945-
7000).
AMERICAN AIRLINES: Seeks Approval of BNY Mellon Agreement
---------------------------------------------------------
AMR Corp. asked the U.S. Bankruptcy Court in Manhattan to approve
an agreement to settle the Bank of New York Mellon's pre-
bankruptcy claims.
BNY Mellon is the indenture trustee for special facility revenue
bonds issued by the New York City Industrial Development Agency,
which owns and operates the John F. Kennedy International
Airport.
Under the deal, the bank is granted one allowed general unsecured
claim of more than $85.7 million against AMR and against American
Airlines Inc. on account of the bonds issued under a 1990
indenture. BNY Mellon is also granted one allowed general
unsecured claim of more than $84.9 million against each of the
airlines on account of the bonds issued under a 1994 indenture.
The deal also allows American Airlines to take over two lease
agreements with the agency with respect to its facilities located
at the JFK airport which, the airline said, are important to
maintain its "comprehensive route network."
The proposed settlement is formalized in a 39-page stipulation,
which is available for free at http://is.gd/AIqEYt
A court hearing is scheduled for April 3. Objections are due by
March 27.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Eagle Keeps Northwest Arkansas Airport Lease
---------------------------------------------------------------
American Eagle Airlines Inc. received the green light to take over
a lease with the Northwest Arkansas Regional Airport Authority.
As part of Eagle's assumption of the lease, the airline will pay
$126,141 to cure any defaults under the lease. The claim,
assigned as Claim No. 2122, filed by the airport authority will
be deemed withdrawn after payment of the so-called cure amount.
The lease dated January 1, 2009, has allowed AMR Corp.'s regional
carrier to operate at the Northwest Arkansas airport.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Proposes Sale & Leaseback of 11 Boeing Planes
----------------------------------------------------------------
AMR Corp. filed a motion seeking court approval to implement a
sale and simultaneous leaseback of up to 11 Boeing 737-823 planes
with Next Generation Aircraft Purchase Limited and AerCap Ireland
Limited.
The Boeing planes are scheduled to be delivered by The Boeing Co.
to American Airlines Inc. between April and October 2013. AMR did
not disclose the purchase price for the aircraft in the motion,
which it filed under seal to protect confidential information.
A court hearing is scheduled for April 3. Objections are due by
March 27.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Ryan Seeks $3.2-Mil. for Fla. Tax Review
-----------------------------------------------------------
Ryan LLC has filed an application for payment of $3,198,083 in
fees earned in connection with the review of American Airlines,
Inc.'s Florida sales and use tax for the period January 1, 2007
to December 31, 2011.
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Pilots, Committees Support US Airways Merger
---------------------------------------------------------------
Stewart Bishop of BankruptcyLaw360 reported that in order to ease
the way for its landmark $11 billion marriage to American Airlines
Inc., U.S. Airways Group Inc. turned to labor experts at O'Melveny
& Myers LLP, who managed to get the pilots unions of both carriers
on board by hammering out a deal that brought certainty to the
airlines and economic benefits to the pilots.
Brian Mahoney of BankruptcyLaw360 also reported that two creditor
committees of bankrupt AMR Corp. threw their weight behind the
company's proposed $11 billion merger with U.S. Airways Friday,
telling a New York federal bankruptcy judge that the deal is the
best shot to transform the company into a profitable and
sustainable airline.
The report related that Chapter 11's official committee of
unsecured creditors and the ad hoc committee of creditors told
U.S. bankruptcy Judge Sean H. Lane that the merger, announced last
month, would provide a significant return to company creditors.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN RESOURCES: A.M. Best Upgrades FSR to 'B'
-------------------------------------------------
A.M. Best Co. has upgraded the financial strength rating to B
(Fair) from B- (Fair) and issuer credit rating to "bb+" from "bb-"
of American Resources Insurance Company Incorporated (ARIC)
(Mobile, AL). The outlook for both ratings is stable.
The rating upgrades reflect ARIC's improved risk-adjusted
capitalization as management shrinks its run-off liabilities,
generally favorable development of legacy loss reserves in recent
years and the continued wind-down of warranty contracts, with
about 90% of them expiring as of year-end 2012.
Partially offsetting these positive rating factors are ARIC's
continued (albeit diminished) uncertainty associated with run-off
legacy black lung workers' compensation and auto warranty
liabilities, the challenges inherent with re-entering the market
in August 2012, including overall execution risk associated with
the implementation of its business plan, and the expectation of
continued underwriting losses through 2015 as set forth by
management due to major upfront investments in technology and
staff in support of business production.
The underwriting losses will likely result in a decline in
risk-adjusted capitalization in the near term. Despite these
concerns, the outlook recognizes the continued orderly run-off of
ARIC's legacy liabilities, the implementation of its improved
corporate governance controls and the resolution of outstanding
issues related to ownership interests of the former management
group.
A.M. Best believes ARIC is adequately positioned at its current
rating level. Continued favorable run-off of the company's
liabilities, improvement in risk-adjusted capitalization as
measured by Best's Capital Adequacy Ratio or profitable operations
supported by an appropriate level of risk-adjusted capital could
lead to favorable movement in ARIC's ratings. However, the
ratings and/or outlook may come under negative pressure if there
is adverse development with the company's run-off liabilities, a
significant deviation in actual operating results from projected
results over the near term or a significant erosion of its capital
base beyond A.M. Best's expectations.
ANACOR PHARMACEUTICALS: E&Y LLP Raises Going Concern Doubt
----------------------------------------------------------
Anacor Pharmaceuticals, Inc., filed on March 18, 2013, its annual
report on Form 10-K for the year ended Dec. 31, 2012.
Ernst & Young LLP, in Redwood City, California, expressed
substantial doubt about Anacor's ability to continue as a going
concern, citing the Company's recurring losses from operations and
its need for additional capital.
The Company reported a net loss of $56.1 million on $10.7 million
of revenues in 2012, compared with a net loss of $47.9 million on
$20.3 million of revenues in 2011.
The Company's balance sheet at Dec. 31, 2012, showed $51.1 million
in total assets, $46.3 million in total liabilities, and
stockholders' equity of $4.8 million.
A copy of the Form 10-K is available at http://is.gd/BmIBox
Palo Alto, Calif.-based Anacor Pharmaceuticals (NASDAQ: ANAC) is a
biopharmaceutical company focused on discovering, developing and
commercializing novel small-molecule therapeutics derived from its
boron chemistry platform. Anacor has discovered eight compounds
that are currently in development. Its two lead product
candidates are topically administered dermatologic compounds-
tavaborole, an antifungal for the treatment of onychomycosis, and
AN2728, an anti-inflammatory PDE-4 inhibitor for the treatment of
atopic dermatitis and psoriasis.
APEX KATY: Chapter 11 Case Dismissed as Payment Deal Okayed
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
entered an order (i) approving Apex Katy Physicians, LLC's
compromise and settlement with creditors; (ii) authorizing the
distribution of funds to creditors and then (iii) dismissing the
Chapter 11 case with prejudice for filing a period of 180 days.
As reported in the Troubled Company Reporter on Feb. 13, 2013,
following a request by the U.S. Trustee to dismiss the Chapter 11
case or have the case converted to Chapter 7, the Debtor agreed
that its case must be dismissed.
In its order approving the dismissal, the Court directed that the
Debtor pay these amounts:
1. $70,149 to Metro Bank;
2. $1,625 to the U.S. Trustee for the U.S. Trustee fees;
3. $5,340 to IRS with respect to Claim No. 4;
4. $4,318 to Brilliant Energy as scheduled claim;
5. $97 to Consolidated Communications as a scheduled claim;
6. 145 to Fikes of Houston as scheduled claim;
7. $151 to Houston Automatic Door as a scheduled claim;
8. $12,612 to Burford, Hawash with respect to Claim No. 6.
Additionally, the law firms of Hoover Slovacek, LLP, general
counsel to the Debtor and Seyfarth Shaw as special counsel to the
Debtor, will share a pro rata basis the retainer refund from MCR
Capital plus up to $35,000 of any additional distributions
received from the bankruptcy case styles Aex Long Term Acute
Care-Katy, L.P. Any additional distributions from the LTAC Case,
$35,000 will be remitted to Metro Bank. The law firms and MCR
Capital will not be required to file fee applications. Dr. Panjak
R. Shah will receive no distribution with respect to his claim.
Except as to the amounts distributed, the rights of the Debtor,
Metro Bank, Dr. Shah and other parties-in-interest to pursue and
any all remedies in other forums is fully reserved.
About Apex Katy Physicians
Apex Katy Physicians, LLC, filed a Chapter 11 petition (Bankr.
S.D. Tex. Case No. 12-31848) on March 6, 2012, estimating
$10 million to $50 million in assets and debts. Judge Marvin
Isgur presides over the case. Attorneys at Hoover Slovacek, LLP,
represent the Debtor.
Affiliate Apex Long Term Acute Care-Katy, LP, a long-term care
facility, filed a separate Chapter 11 petition (Case No. 09-37096)
on Sept. 25, 2009. The Debtor disclosed $15,237,691 in assets and
$13,646,951 in liabilities.
APPLETON PAPERS: Incurs $148.4 Million Net Loss in Fiscal 2012
--------------------------------------------------------------
Appleton Papers Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$148.45 million on $849.75 million of net sales for the year ended
Dec. 29, 2012, as compared with a net loss of $47.65 million on
$857.32 million of net sales for the year ended Dec. 31, 2011.
The Company incurred a $31.25 million net loss for the year ended
Jan. 1, 2011.
The Company's balance sheet at Dec. 29, 2012, showed
$561.07 million in total assets, $913.98 million in total
liabilities, and a $352.91 million total deficit.
A copy of the Form 10-K is available for free at:
http://is.gd/qUmKeD
The Company subsequently filed an amendment to the Form 10-K to
furnish the Interactive Data File exhibits required by Item
601(b)(101) of Regulation S-K. The inclusion of the Interactive
Data File Exhibits was inadvertently omitted in the earlier
filing. No other changes have been made to the 10-K. A copy of
the amended Form 10-K is available at http://is.gd/4VvA3u
About Appleton Papers
Appleton, Wisconsin-based Appleton Papers --
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.
* * *
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.
APPLIED MINERALS: Incurs $9.7 Million Net Loss in 2012
------------------------------------------------------
Applied Minerals, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of $9.73 million on $165,742 of revenue for the year
ended Dec. 31, 2012, as compared with a net loss of $7.43 million
on $92,952 of revenue in 2011. The Company incurred a
$4.76 million net loss in 2010.
The Company's balance sheet at Dec. 31, 2012, showed $7.81 million
in total assets, $3.85 million in total liabilities and
$3.96 million in total stockholders' equity.
Bankruptcy Warning
"The Company has had to rely mainly on cash flow generated from
the sale of stock and convertible debt to fund its operations. If
the Company is unable to fund its operations through the
commercialization of its minerals at the Dragon Mine, it may have
to file bankruptcy, as there is no assurance of the foregoing."
A copy of the Form 10-K is available for free at:
http://is.gd/7sGhuV
About Applied Minerals
New York City-based Applied Minerals (OTC BB: AMNL) is a leading
global producer of halloysite clay used in the development of
advanced polymer, catalytic, environmental remediation, and
controlled release applications. The Company operates the Dragon
Mine located in Juab County, Utah, the only commercial source of
halloysite clay in the western hemisphere. Halloysite is an
aluminosilicate clay that forms naturally occurring nanotubes.
ARCAPITA BANK: Court Extends Plan Exclusivity Until April 10
------------------------------------------------------------
In an ex parte order, the U.S. Bankruptcy Court for the District
of Missouri extended Arcapita Bank B.S.C. and its affiliated
debtors' exclusive period to solicit acceptances of the plan
through the hearing on the Debtors' exclusivity motion. The
hearing on the exclusivity motion has been adjourned from
March 26, 2013, at 10:00 a.m., until April 10, 2013, at 11:00 a.m.
Arcapita filed papers seeking an expansion of the exclusive right
to solicit acceptances of a plan from April 9 to July 7, in order
to work out additional agreements with interested parties in
portfolio investments not in bankruptcy.
Arcapita has said that although its plan is "confirmable," the
Debtor said it would be preferable to work out additional
agreements with interested parties in portfolio investments not in
bankruptcy.
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., 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 had 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.
AS SEEN ON TV: Delays Form 10-Q for Dec. 31 Quarter
---------------------------------------------------
As Seen On TV, Inc., informed the U.S. Securities and Exchange
Commission that it will be late in the filing of its quarterly
report on Form 10-Q for the period ended Dec. 31, 2012. The
Company said certain financial and other information necessary for
an accurate and full completion of the Report could not be
provided within the prescribed time period without unreasonable
effort or expense.
About As Seen on TV
Clearwater, Fla.-based As Seen On TV, Inc., is a direct response
marketing company. It identifies, develops, and markets consumer
products.
The Company reported a net loss of $8.07 million for the year
ended March 31, 2012, compared with a net loss of $6.97 million
during the prior fiscal year.
The Company's balance sheet at Sept. 30, 2012, showed
$9.74 million in total assets, $23.42 million in total liabilities
and a $13.68 million total stockholders' deficiency.
As reported by the TCR on Nov. 6, 2012, As Seen On TV entered into
an Agreement and Plan of Merger with eDiets Acquisition Company
("Merger Sub"), eDiets.com, Inc., and certain other individuals.
Pursuant to the Merger Agreement, Merger Sub will merge with and
into eDiets.com, and eDiets.com will continue as the surviving
corporation and a wholly-owned subsidiary of the Company.
AS SEEN ON TV: Amends Services Agreement with Kevin Harrington
--------------------------------------------------------------
As Seen On TV, Inc., and Kevin Harrington, Company's chairman of
the board of directors, entered into an agreement to amend Mr.
Harrington's services agreement dated Oct. 28, 2011. Pursuant to
the amendment, Mr. Harrington's base annual compensation is
reduced to $225,000. Mr. Harrington's duties under the agreement
will not require him to serve on the Company's board of directors.
Moreover, certain compensatory benefits payable to Mr. Harrington
upon termination for death or disability or termination without
cause, for good reason or change of control have been eliminated.
In consideration for amending the services agreement, the Company
and Mr. Harrington agreed to amend the licensing agreement dated
Feb. 8, 2012. Pursuant to the license agreement amendment,
subject to the limitations provided under the services agreement,
as amended, during the term of the services agreement
Mr. Harrington will license his name and likeness to the Company
on a non-exclusive basis. Pursuant to the non-exclusive license,
(1) the Company will pay Mr. Harrington 10% of any adjusted gross
receipts received by the Company from its use of Mr. Harrington's
likeness or image and (2) if Mr. Harrington generates any revenues
from a Pitch Tank(R) speaking engagement, he will pay 10% of the
adjusted gross receipts to the Company.
About As Seen on TV
Clearwater, Fla.-based As Seen On TV, Inc., is a direct response
marketing company. It identifies, develops, and markets consumer
products.
The Company reported a net loss of $8.07 million for the year
ended March 31, 2012, compared with a net loss of $6.97 million
during the prior fiscal year. The Company's balance sheet at
Dec. 31, 2012, showed $16.08 million in total assets,
$36.36 million in total liabilities and a $20.28 million total
stockholders' deficiency.
AS SEEN ON TV: Appoints Ronald Pruett as President and CEO
----------------------------------------------------------
As Seen On TV, Inc., said that direct-to-consumer marketing
veteran Ronald C. Pruett, Jr., will assume the positions of
President, Chief Executive Officer and Director. The Company also
announced the resignation of President and Chief Executive Officer
Steve Rogai, effective immediately. Mr. Rogai will continue to
serve as an advisor to the Company until April 1, 2013, to assist
with transition matters.
"On behalf of the Board of Directors, we want to thank Steve for
his contributions to As Seen On TV," said Kevin Harrington, the
Company's Chairman. "For the past three years, Steve has led the
Company through many challenges, and we wish him well in his
future endeavors."
Mr. Harrington continued, "Ron Pruett has spent the past few
months working closely with our management team and strategic
partners on the post-merger integration of As Seen On TV and
eDiets. We have a unique industry platform and look forward to
building the company's future success together."
"I truly want to thank our shareholders, the team at ASTV and
Kevin Harrington for all their involvement and support since
inception. As co-founder of the company, the decision to step out
of the role was one that was not easy but working closely with the
new management and members of the board these last few weeks has
given me the assurance we have the right team to lead us through
our next stage of growth," stated Steve Rogai.
Mr. Pruett has over 25 years experience in the direct to consumer
and direct response marketing industries. He joins the company
from the Boston Associates, an advisor to consumer-focused
companies and their investors. Prior to that, Mr. Pruett was the
Chief Marketing Officer and executive committee member of Acquia,
a venture-backed open source software company. During his tenure,
Acquia was named one of America's most promising companies by
Forbes Magazine, and one of America's fastest growing private
companies by Inc. Magazine. Mr. Pruett was formerly Chief
Executive Officer of Mercury Media, the largest independent direct
response agency in the US, and Executive Vice President and Chief
Marketing Officer of Polymedica (PLMD), which was acquired by
Medco Health Solutions (MHS) for $1.5B in 2007.
In connection with Mr. Rogai's resignation, the Company and Mr.
Rogai entered into the Agreement and General Release. By virtue
of Mr. Rogai's resignation and entry into the Agreement and
General Release, the Rogai Employment Agreement terminated.
Pursuant to the Agreement and General Release, Mr. Rogai will
receive as severance (i) 12 months of his base salary of $225,000
payable in four equal quarterly installments, (ii) the sum of
$14,091 in four equal quarterly installments to cover Mr. Rogai's
COBRA premiums for 12 months under the Company's group health
plan, (iii) $5,990 as accrued vacation pay, and (iv) $3,000 as a
transitional car allowance. In addition the Company agreed to
vest all stock options held by Mr. Rogai, which will remain
exercisable for the full term of their grant, notwithstanding any
contrary provision in the applicable award agreements.
Additional information can be obtained at http://is.gd/C6YLEE
About As Seen on TV
Clearwater, Fla.-based As Seen On TV is a direct response
marketing company. It identifies, develops, and markets consumer
products.
The Company reported a net loss of $8.07 million for the year
ended March 31, 2012, compared with a net loss of $6.97 million
during the prior fiscal year. The Company's balance sheet at
Dec. 31, 2012, showed $16.08 million in total assets,
$36.36 million in total liabilities and a $20.28 million total
stockholders' deficiency.
ASPEN GROUP: Incurs $6 Million Net Loss in 2012
-----------------------------------------------
Aspen Group, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$6.01 million on $5.01 million of revenue for the year ended
Dec. 31, 2012, as compared with a net loss of $2.13 million on
$4.47 million of revenue during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed $3.49 million
in total assets, $2.69 million in total liabilities and $801,755
in total stockholders' equity.
Salberg & Company, P.A., in Boca Raton, Florida, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company has a net loss allocable to common stockholders
and net cash used in operating activities in 2012 of $6,048,113
and $4,403,361, respectively, and has an accumulated deficit of
$11,337,104 as of December 31, 2012. These matters raise
substantial doubt about the Company's ability to continue as a
going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/OY3sY0
About Aspen Group
Denver, Colo.-based Aspen Group, Inc., was founded in Colorado in
1987 as the International School of Information Management. On
Sept. 30, 2004, it was acquired by Higher Education Management
Group, Inc., and changed its name to Aspen University Inc. On
May 13, 2011, the Company formed in Colorado a subsidiary, Aspen
University Marketing, LLC, which is currently inactive. On
March 13, 2012, the Company was recapitalized in a reverse merger.
Aspen's mission is to become an institution of choice for adult
learners by offering cost-effective, comprehensive, and relevant
online education. Approximately 88% of the Company's degree-
seeking students (as of June 30, 2012) were enrolled in graduate
degree programs (Master or Doctorate degree program). Since 1993,
the Company has been nationally accredited by the Distance
Education and Training Council, a national accrediting agency
recognized by the U.S. Department of Education.
ASSURED PHARMACY: Jack Brooks Holds 36% Equity Stake at Feb. 5
--------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Jack E. Brooks and his affiliates disclosed
that, as of Feb. 5, 2013, they beneficially own 2,503,336 shares
of common stock of Assured Pharmacy, Inc., representing 36.7% of
the shares outstanding. A copy of the filing is available for
free at http://is.gd/iIcUqz
About Assured Pharmacy
Headquartered in Frisco, Texas, Assured Pharmacy, Inc., is engaged
in the business of establishing and operating pharmacies that
specialize in dispensing highly regulated pain medication for
chronic pain management.
The Company was organized as a Nevada corporation on Oct. 22,
1999, under the name Surforama.com, Inc., and previously operated
under the name eRXSYS, Inc. The Company changed its name to
Assured Pharmacy, Inc., in October 2005.
The Company's balance sheet at Sept. 30, 2012, showed
$2.64 million in total assets, $8.68 million in total liabilities,
and a stockholders' deficit of $6.04 million.
"As of Sept. 30, 2012, the Company had an accumulated deficit of
approximately $42.6 million and recurring losses from operations.
The Company also had negative working capital of approximately
$5.0 million and debt with maturities within one year in the
amount of approximately $2.1 million as of Sept. 30, 2012.
"The Company intends to fund operations through raising additional
capital through debt financing and equity issuances, increased
sales, increased collection activity on past due other receivable
balances and reduced expenses, which may be insufficient to fund
its capital expenditures, working capital or other cash
requirements for the year ending Dec. 31, 2012. The Company is in
negotiations with current debt holders to restructure and extend
payment terms of the existing short term debt. The Company is
seeking additional funds to finance its immediate and long-term
operations. The successful outcome of future financing activities
cannot be determined at this time and there is no assurance that
if achieved, the Company will have sufficient funds to execute its
intended business plan or generate positive operating results.
These factors, among others, raise substantial doubt about the
Company's ability to continue as a going concern."
AVID TECHNOLOGY: Gets NASDAQ Listing Non-Compliance Notice
----------------------------------------------------------
Avid Technology, Inc. on March 21 disclosed that, due to the
previously disclosed delay in the filing of its annual report on
Form 10-K for the year ended December 31, 2012, the Company has,
as expected, received on March 19, 2013 a notification letter from
staff of the NASDAQ Listing Qualifications Department. The
notification states that the Company is no longer in compliance
with NASDAQ Marketplace Rule 5250(c)(1), which requires timely
filing of periodic reports with the Securities and Exchange
Commission. The NASDAQ letter was issued in accordance with
standard NASDAQ procedure, which provides that failure to timely
file the Company's Form 10-K could serve as a basis for the
delisting of the Company's stock from the NASDAQ Global Select
Market. The Company intends to submit to the Staff a plan as to
how it plans to regain compliance with NASDAQ's continued listing
requirements. The NASDAQ notice specifies that this plan has to
be submitted by May 20, 2013. If the Staff accepts the Company's
plan, the Company expects to have up to 180 calendar days from the
initial due date for the Form 10-K, or until September 16, 2013,
to regain compliance. If the Staff does not accept Avid's plan,
Avid will have the opportunity to appeal that decision to a NASDAQ
Hearings Panel. The NASDAQ notice has no immediate effect on the
listing of Avid's common stock on the NASDAQ Global Select Market.
On March 19, 2013, the Company filed a Form 12b-25 with the SEC
stating that it was unable to file the Form 10-K with the SEC on
or before March 18, 2013, the prescribed due date, because it is
continuing to evaluate the accounting treatment related to bug
fixes, upgrades and enhancements in certain of the Company's
customer arrangements. The primary focus of the Company's
evaluation to date has been to determine whether certain Software
Updates previously thought to be only bug fixes met the definition
of post-contract customer support under U.S. Generally Accepted
Accounting Principles. The Company is working diligently to
complete the review and continues to focus its efforts on
completing the Form 10-K filing as soon as possible.
During this evaluation, the Company plans to continue to invest in
its product innovation and execute on its growth strategy. The
company has no debt and ample cash to support it in these efforts
and believes it is well positioned to support its customers'
ongoing success.
B&T OLSON: Has Court's Nod to Continue Using Cash Collateral
------------------------------------------------------------
The Hon. Karen A. Overstreet of the U.S. Bankruptcy for the
Western District of Washington entered an agreed order extending B
& T Olson Family LLC's continued use of Opus Bank's cash
collateral.
The Debtor and Opus Bank have stipulated and agreed to extend the
cash collateral budget and adequate protection payments through
plan confirmation.
For each month from entry of this court order through plan
confirmation, the Debtor's use of Opus Bank's cash collateral is
limited to the amounts set forth in the budget. In addition, the
Debtor will continue to make adequate protection payments as set
forth under the Fourth Interim Order for each month until plan
confirmation.
As reported by the Troubled Company Reporter on Jan. 14, 2013, the
agreed fourth interim order signed by the Court provided for the
use of cash from July to December 2012. A copy of the budget is
available for free at:
http://bankrupt.com/misc/B&TOLSON_cashcoll_budget.pdf
Other terms and conditions in the fourth interim order will
continue and remain in full force and effect through plan
confirmation.
About B&T Olson Family
Based in Snohomish, Washington, B&T Olson Family LLC owns certain
commercial real properties in Snohomish and Island County,
Washington, commonly known as the Resilience Fitness Building, the
Team Fitness Building, the Downtown/Port Susan Building, and
Camano Commons Building G.
The Company filed for Chapter 11 protection (Bankr. W.D. Wash.
Case No. 12-14352) on April 26, 2012, in Seattle on April 26,
2012. B&T Olson disclosed $18.3 million in assets and $17.5
million in assets in its schedules. The Debtor owns six
properties in Lake Stevens, Stanwood, and Camano Island,
Washington. Four properties worth $16 million secure $12 million
of debt to Opus Bank. Brett T. Olson and Christina L. Olson own
the Debtors.
Judge Karen A. Overstreet oversees the case. James L. Day, Esq.,
and Katriana L. Samiljan, Esq., at Bush Strout & Kornfeld LLP,
in Seattle, Wash., serve as the Debtor's counsel.
Joseph A.G. Sakay, Esq., and Eric D. Lansverk, Esq., at Hillis
Clark Martin & Peterson P.S., in Seattle, Washington, represent
Opus Bank as counsel. Michael C. Oiffer, at KeyBank Law Group, in
Tacoma, Washington, represents KeyBank National Association as
counsel.
BEALL CORP: PSC Custom Bags Parts and Services Biz. for $4.25MM
---------------------------------------------------------------
The Hon. Elizabeth Perris of the U.S. Bankruptcy Court for the
District of Oregon authorized Beall Corporation to sell its parts
and services division to PSC Custom, LP, a Texas limited
partnership. The Debtor determined that PSC provided the highest
and best offer of $4.25 million, subject to certain adjustments,
and Wabash National Corporation, a Delaware corporation, is the
back up bidder, with a bid of $4.15 million. A copy of the sale
order is available for free at
http://bankrupt.com/misc/BEALLCORPORATION_sale_order.pdf
About Beall Corporation
Portland, Oregon-based Beall Corporation, a manufacturer of
lightweight, efficient, and durable tanker trucks, trailers and
related products, filed a Chapter 11 bankruptcy petition (Bankr.
D. Ore. Case No. 12-37291) on Sept. 24, 2012, estimating at least
$10 million in assets and liabilities. Founded in 1905, Beall has
four factories and nine sale branches across the U.S. The Debtor
has 285 employees, with an average weekly payroll of $300,000.
Judge Elizabeth L. Perris presides over the case. The Debtor has
tapped Tonkon Torp LLP as counsel. The Debtor disclosed
$14,015,232 in assets and $28,791,683 in liabilities as of the
Chapter 11 filing.
Wabash National Corporation on Feb. 4 successfully closed on its
acquisition of certain assets of the tank and trailer business of
Beall for $15 million.
Robert D. Miller Jr., the U.S. Trustee for Region 18, appointed
six members to the official committee of unsecured creditors.
Ball Janik LLP represents the Committee.
BEARINGPOINT INC: Liquidating Trust Settles Suit v. Ex-Directors
----------------------------------------------------------------
John DeGroote Services, LLC, as liquidating trustee to the
BearingPoint, Inc. Liquidating Trust, on March 21 disclosed that
the Trust settled its lawsuit against former Directors and the
former Chief Executive Officer of BearingPoint, Inc. Under the
settlement, the Trust will receive $55 million, with no admission
of liability and a release of claims by all parties.
"This settlement will generate a significant additional recovery
for BearingPoint's creditors, and it culminates a multi-year
effort to bring this litigation to resolution," said John
DeGroote, President of John DeGroote Services, LLC. "If all goes
as planned we'll be in a position to distribute the proceeds from
this settlement, net of litigation expenses and other costs, by
midsummer."
Three former directors of BearingPoint have agreed to dismiss a
lawsuit they recently filed in Virginia against Mr. DeGroote.
Mr. DeGroote has agreed to dismiss his request to the New York
Bankruptcy Court to hold the three former directors in contempt
and impose sanctions for violating a court order by filing the
lawsuit against him in Virginia.
The Trust was represented in the Director and Officer action by
Whiteford, Taylor & Preston L.L.P., led by Kevin Hroblak and
William Ryan, and McKool Smith, P.C., led by Robert Manley and
Lewis LeClair, and Christopher Nolland, who served as Special
Settlement Counsel to the Trust.
The settlement agreement has been submitted for approval to the
Honorable Robert E. Gerber of the United States Bankruptcy Court
for the Southern District of New York.
About BearingPoint Inc.
BearingPoint, Inc. -- http://www.BearingPoint.com/-- was one of
the world's largest providers of management and technology
consulting services to Global 2000 companies and government
organizations in more than 60 countries worldwide.
BearingPoint, Inc., fka KPMG Consulting, Inc., together with its
units, filed for Chapter 11 protection (Bankr. S.D.N.Y., Case No.
09-10691) on Feb. 18, 2009. BearingPoint disclosed total assets
of $1.655 billion and debts of $2.201 billion as of Dec. 31, 2008.
The Debtors' legal advisor was Weil, Gotshal & Manges, LLP. Their
restructuring advisor was AlixPartners LLP, and their financial
advisor and investment banker was Greenhill & Co., LLC. Jeffrey
S. Sabin, Esq., at Bingham McCutchen LLP represented the
Creditors' Committee. Garden City Group served as claims and
notice agent.
On the Petition Date, BearingPoint filed a Chapter 11 plan of
reorganization negotiated with lenders prepetition. BearingPoint,
however, changed course and pursued a sale of its units, after
determining that creditor recoveries would be maximized through
sales of the businesses.
On Dec. 22, 2009, the Bankruptcy Court entered an order confirming
the Debtors' Modified Second Amended Joint Plan. On Dec. 31,
2009, a Notice of Effective Date of the Plan was filed with the
Bankruptcy Court. John DeGroote was appointed as liquidating
trustee under the Plan. The liquidating trustee is represented by
Katherine Dobson, Esq., at Bingham McCutchen, in Hartford,
Connecticut. The trustee also has retained McKool Smith P.C. and
Whiteford, Taylor & Preston L.L.P. to pursue claims against former
company officers.
BELFOR HOLDINGS: Moody's Rate New $170MM Revolver Debt 'Ba3'
------------------------------------------------------------
Moody's Investors Service assigned Ba3 ratings to Belfor Holdings,
Inc.'s proposed $170 million revolving credit facility and $350
million term loan. The Ba3 ratings on the outstanding $125 million
revolving credit facility and approximately $378 million term loan
will be withdrawn upon repayment of these loans with proceeds of
the new bank debt. Moody's also affirmed the company's B1
corporate family and B1-PD probability of default ratings. Moody's
notes these rating actions are subject to review of the pending
2012 audited statements. The rating outlook is stable.
Ratings
Belfor Holdings, Inc.
Corporate Family Rating: affirmed B1
Probability of Default Rating: affirmed B1-PD
Belfor USA Group, Inc.
$170 million secured revolving credit due 2018: assigned Ba3/
LGD3-39%
$150 million secured term loan due 2018: assigned Ba3/ LGD3-39%
$200 million secured term loan due 2019: assigned Ba3/ LGD3-39%
$125 million secured revolving credit due 2016: affirmed Ba3/
LGD3-39%, to be withdrawn upon closing of new debt
$145 million secured term loan due 2016: affirmed Ba3/ LGD3-39%,
to be withdrawn upon closing of new debt
$250 million secured term loan due 2017: affirmed Ba3/ LGD3-39%,
to be withdrawn upon closing of new debt
Outlook: Stable
Ratings Rationale:
Belfor's B1 CFR is driven by its leading global position in the
clean-up and restoration business, solid interest coverage (just
under 3x Moody's adjusted EBITDA-capex/interest for the twelve
months ending September 30, 2012), strong relationships with
insurers and facility owners, and flexible cost structure. These
factors are offset by Belfor's high single digit EBITDA margins
reported in recent years and leverage (4.7x Moody's adjusted
debt/EBITDA) which are in line with the B rating category. The
ability to adjust workforce size and compensation is important as
episodes of property damage are unpredictable, though the history
suggests these episodes seem to occur with some regularity on a
national level. Belfor has built relationships with property and
casualty insurers funding disaster response and recovery, as well
as with many multi-national manufacturing companies who seek to
mitigate property damage and expeditiously return their facilities
to operating form. The company' s largest balance sheet asset is
working capital as Belfor incurs costs well ahead of reimbursement
by the insurer or client. This provides Belfor a competitive
advantage over small operators who cannot fund receivables for
multiple months. Moody's observes the company has earned pre-tax
profits in every year starting with 2004 (the earliest period for
which this data is available), evidence of management's careful
handling of leverage and the company's costs. Lastly, the
company's footprint is extensive, covering North and South
America, Europe, Asia, Africa, and Australia, though penetration
in most of these regions is modest.
The stable outlook is driven by Moody's expectation for the
company to prudently finance and methodically achieve geographic
expansion and deepen market penetration. Natural and man-caused
disasters are expected to recur within the historic range of
normal, and Moody's notes 2012 insured losses for property damage,
the company's primary revenue source, was near the low end of the
range of recent years. In the event of a dramatic revenue decline,
the company is expected to reduce labor expense, both in
compensation per employees and reduction in force, to minimize
losses.
The company's liquidity, pro-forma for the refinancing, is good
with about $100 million available on the company's revolver,
nearly $40 million cash at year end 2012, and expectation for
modest positive free cash flow generation in each of 2013 and
2014. Annual debt amortization through 2014 is under $10 million.
Up to $25 million of the revolver is available to be borrowed in
each of the Canadian dollar and Euro, though Moody's notes the
presence of cash retained in overseas subsidiaries for tax
efficiency factors, which reduces the likelihood of those
operations drawing on the revolver. The company did not pay a
dividend in 2011 and 2012 after paying debt funded dividends in
2009 and 2010. The company instead spent on market expansion and
debt reduction, and Moody's expects this latest policy to continue
through 2014.
Leverage remaining below 4x Moody's adjusted level, free cash
flow/ debt over 10%, and evidence of a commitment to a more
conservative financial policy could lead to higher ratings.
Leverage over 5x, negative free cash flow, or a material decline
in margins could lead to a ratings downgrade.
The principal methodology used in this rating was the Global
Business & Consumer Service Industry Rating Methodology published
in October 2010. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.
Birmingham, MI based Belfor USA, Inc., is the global leader in
property damage mitigation and restoration for commercial and
residential assets. The company has been management owned since
the 2006 buyout and reported $1.3bb revenue for the twelve months
ending September 30, 2012 and 6,000 full time employees as of
year-end 2012.
BEST UNION: Has Access to Cash Collateral Until June 30
-------------------------------------------------------
The Hon. Peter H. Carroll of the U.S. Bankruptcy Court for the
Central District of California has authorized The Best Union, LLC,
to use cash collateral of SPCP Group V, LLC, until June 30, 2013.
The Debtor needs to use the cash collateral to operate the
property located at 3656 W. Shaw Avenue, Fresno, California, and
SPCP has agreed to the use of its cash collateral.
SPCP, which has a secured claim on account of secured loans in the
original principal amount of $2.4 million, will receive, as
protection from any diminution in value of its collateral,
replacement liens and adequate protection payments.
A copy of the budget is available for free at:
http://bankrupt.com/misc/BEST_UNION_cashcollbudget.pdf
About The Best Union
West Covina, California-based, The Best Union LLC, owns properties
in West Covina and Fresno, California. Bank of China and SPCP
Group V, LLC, have secured claims of $5.888 million and
$2.255 million, respectively. The West Covina property generated
income of $752,000 last year. The Fresno property generated
income of $251,000 in 2011.
The Company filed for Chapter 11 protection (Bankr. C.D. Cal.
Case No. 12-32503) on June 28, 2012. Bankruptcy Judge Peter
Carroll presides over the case. Mufthiha Sabaratnam, Esq., at
Sabaratnam and Associates represents the Debtor in its
restructuring effort. The Debtor has scheduled assets of
$11,431,364, and scheduled liabilities of $9,195,179. The
petition was signed by James Lee, manager.
BG MEDICINE: Incurs $23.8 Million Net Loss in 2012
--------------------------------------------------
BG Medicine, Inc., filed on March 18, 2013, its annual report on
Form 10-K, reporting a net loss of $23.8 million on $2.8 million
of revenues for the year ended Dec. 31, 2012, compared with a net
loss of $17.6 million on $1.6 million of revenues for the year
ended Dec. 31, 2011.
The Company's balance sheet at Dec. 31, 2012, showed $15.2 million
in total assets, $14.9 million in total liabilities, and
stockholders' equity of $309,000.
At Dec. 31, 2012, the Company had cash and cash equivalents
totaling $12.8 million, restricted cash totaling $390,000 and
stockholders' equity of $309,000. During the year ended Dec. 31,
2012, the Company incurred a net loss totaling $23.8 million and
used cash in operating activities totaling $21.3 million. The
Company expects to continue to incur losses in the
commercialization of its cardiovascular diagnostic text and the
operations of its business and use cash in operating activities in
2013 and beyond. "These circumstances may raise substantial doubt
about our ability to continue as a going concern."
A copy of the Form 10-K is available at http://is.gd/Cf7lB5
Waltham, Mass.-based BG Medicine is a diagnostics company focused
on the development and commercialization of novel cardiovascular
diagnostic tests to address significant unmet medical needs,
improve patient outcomes and contain healthcare costs. The
Company is currently commercializing two diagnostic tests, the
first of which is the BGM Galectin-3 test, a novel assay for
measuring galectin-3 levels in blood plasma or serum for use as an
aid in assessing the prognosis of patients diagnosed with heart
failure. The Company's second diagnostic test is the CardioSCORE
test, which is designed to identify individuals at high risk for
near-term, significant cardiovascular events, such as heart attack
and stroke.
BIOCORAL INC: Delays Financials for Year Ended Dec. 31, 2012
------------------------------------------------------------
Biocoral, Inc., was unable to file its annual report on Form 10-K
for the period ended Dec. 31, 2012, in a timely manner because the
Company was not able to complete timely its financial statements
without unreasonable effort or expense.
About Biocoral, Inc.
Headquartered in La Garenne Colombes, France, Biocoral, Inc.
-- http://www.biocoral.com/-- was incorporated under the laws of
the State of Delaware on May 4, 1992. Biocoral is a holding
company that conducts its operations primarily through its wholly-
owned European subsidiaries. The Company's operations consist
primarily of research and development and manufacturing and
marketing of patented high technology biomaterials, bone
substitute materials made from coral, and other orthopedic, oral
and maxillo-facial products, including products marketed under the
trade name of Biocoral. Most of the Company's operations are
conducted from Europe. The Company has obtained regulatory
approvals to market its products throughout Europe, Canada and
certain other countries. The Company owns various patents for its
products which have been registered and issued in the United
States, Canada, Japan, Australia and various countries throughout
Europe. However, the Company has not applied for the regulatory
approvals needed to market its products in the United States.
Michael T. Studer CPA P.C., in Freeport, New York, noted that the
Company's present financial condition raises substantial doubt
about its ability to continue as a going concern. The independent
auditors added that the Company had net losses for the years ended
Dec. 31, 2011, and 2010, respectively. Management believes that
it is likely that the Company will continue to incur net losses
through at least 2012. The Company had a working capital
deficiency of approximately $1,570,000 and $2,125,000, at Dec. 31,
2011 and 2010, respectively. The Company also had a stockholders'
deficit at Dec. 31, 2011, and 2010, respectively.
Biocoral reported a net loss of $920,103 in 2011, compared with a
net loss of $703,272 in 2010. The Company's balance sheet at
Sept. 30, 2012, showed $1.24 million in total assets, $5.37
million in total liabilities and a $4.12 million total
stockholders' deficit.
BROADCAST INTERNATIONAL: Mark Spagnolo Quits as Director
--------------------------------------------------------
Mark F. Spagnolo resigned as a director of Broadcast
International, Inc., effective as of Feb. 12, 2013.
About Broadcast International
Based in Salt Lake City, Broadcast International, Inc., installs,
manages and supports private communication networks for large
organizations that have widely-dispersed locations or operations.
The Company owns CodecSys, a video compression technology to
convert video content into a digital data stream for transmission
over satellite, cable, Internet, or wireless networks, as well as
offers audio and video production services. The Company's
enterprise clients use its networks to deliver training programs,
product announcements, entertainment, and other communications to
their employees and customers.
The Company reported net income of $1.30 million in 2011, compared
with a net loss of $18.66 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$3.15 million in total assets, $9.45 million in total liabilities,
and a $6.30 million total stockholders' deficit.
CAESARS ENTERTAINMENT: Amends 2012 Annual Report
------------------------------------------------
Caesars Entertainment Corporation filed with the U.S. Securities
and Exchange Commission an amendment no. 1 to its annual report on
Form 10-K for the year ended Dec. 31, 2012, which was originally
filed on March 15, 2013, for the sole purpose of including the
inadvertently unsigned Exhibit 23 Consent of Deloitte & Touche
LLP, independent registered public accounting firm. A copy of the
Amended Form 10-K is available at http://is.gd/K97yyH
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.
-- http://www.caesars.com/-- is one of the world's largest casino
companies, with annual revenue of $4.2 billion, 20 properties on
three continents, more than 25,000 hotel rooms, two million square
feet of casino space and 50,000 employees. Caesars casino resorts
operate under the Caesars, Bally's, Flamingo, Grand Casinos,
Hilton and Paris brand names. The Company has its corporate
headquarters in Las Vegas.
Harrah's announced its re-branding to Caesar's on mid-November
2010.
The Company incurred a net loss of $1.49 billion on $8.58 billion
of net revenues for the year ended Dec. 31, 2012, as compared with
a net loss of $666.70 million on $8.57 billion of net revenues
during the prior year. The Company incurred a $823.30 million net
loss in 2010. The Company's balance sheet at Dec. 31, 2012,
showed $27.99 billion in total assets, $28.32 billion in total
liabilities and a $331.6 million total deficit.
* * *
Caesars Entertainment carries a 'CCC' long-term issuer default
rating, with negative outlook, from Fitch and a 'Caa1' corporate
family rating with negative outlook from Moody's Investors
Service.
As reported in the TCR on Feb. 5, 2013, Moody's Investors Service
lowered the Speculative Grade Liquidity rating of Caesars
Entertainment Corporation to SGL-3 from SGL-2, reflecting
declining revolver availability and Moody's concerns that Caesars'
earnings and cash flow will remain under pressure causing the
company's negative cash flow to worsen.
CARY CREEK: Court Okays Northen Blue as Bankruptcy Counsel
----------------------------------------------------------
Cary Creek Limited Partnership obtained authorization from the
Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the
Eastern District of North Carolina to employ John A. Northen and
the firm of Northen Blue, LLP, as bankruptcy counsel.
Northen will represent the Debtor in connection with the
restructuring of existing secured and unsecured debt in the
context of a Chapter 11 proceeding. With respect to the pending
litigation with Bank of America, the firm expects to associate the
firm of Rayburn Cooper & Durham, P.A., as special counsel due to
RC&D's existing representation of the Debtor in that matter.
About Cary Creek
Cary Creek Limited Partnership sought Chapter 11 protection
(Bankr. E.D.N.C. Case No. 13-00041) on Jan. 3, 2013.
Cary Creek is the owner of 1,009 acres of land located adjacent to
the west boundary of NC Highway 55 immediately sought of its
interchange with NC-540/I-540, in Cary, Wake County, North
Carolina. The property is managed by American Asset Corporation.
The primary secured creditor is Bank of America, N.A. BofA has a
first mortgage lien on the Debtor's property.
Cary Creek is seeking joint administration of its Chapter 11 case
with the consolidated Chapter 11 cases of Brier Creek Corporate
Center Associates Limited Partnership, et al., which sought
bankruptcy protection on March 9, 2012 (Bankr. E.D.N.C. Lead Case
No. 12-01855). Brier Creek, et al., own real property located in
Wake County, North Carolina and Mecklenburg County, North
Carolina.
Cary Creek and the Brier Creek Debtors are parties to litigation
pending in the Bankruptcy Court against BofA, Adv. Proc. No.
12-00121. The BofA litigation was instituted on Oct. 13, 2011,
in Mecklenburg County Superior Court, and was removed and
subsequently transferred to the Bankruptcy Court after the Brier
Creek Debtors filed for Chapter 11 bankruptcy protection in March
2012. Cary Creek is related to the Brier Creek Debtors through
common ownership, common property management, and common secured
and unsecured creditors.
CARY CREEK: Has Nod to Keep Affiliate AAC as Property Manager
-------------------------------------------------------------
The Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for
the Eastern District of North Carolina has granted Cary Creek
Limited Partnership authorization to continue the employment of
American Asset Corporation as property manager for the Debtor.
AAC, formerly known as AAC Real Estate Services, Inc., a North
Carolina corporation, was the property manager for the Debtor's
property in North Carolina prior to the Petition Date. AAC, an
affiliate of the Debtor by way of common ownership, employs
individuals who oversee and handle the day-to-day management and
development of the property pursuant to a Development,
Construction Management and Marketing Agreement dated June 8, 2004
between the Debtor and AAC. AAC also is the property manager for
other companies affiliated with the Debtor.
About Cary Creek
Cary Creek Limited Partnership sought Chapter 11 protection
(Bankr. E.D.N.C. Case No. 13-00041) on Jan. 3, 2013.
Cary Creek is the owner of 1,009 acres of land located adjacent to
the west boundary of NC Highway 55 immediately sought of its
interchange with NC-540/I-540, in Cary, Wake County, North
Carolina. The property is managed by American Asset Corporation.
The primary secured creditor is Bank of America, N.A. BofA has a
first mortgage lien on the Debtor's property.
Cary Creek is seeking joint administration of its Chapter 11 case
with the consolidated Chapter 11 cases of Brier Creek Corporate
Center Associates Limited Partnership, et al., which sought
bankruptcy protection on March 9, 2012 (Bankr. E.D.N.C. Lead Case
No. 12-01855). Brier Creek, et al., own real property located in
Wake County, North Carolina and Mecklenburg County, North
Carolina.
Cary Creek and the Brier Creek Debtors are parties to litigation
pending in the Bankruptcy Court against BofA, Adv. Proc. No.
12-00121. The BofA litigation was instituted on Oct. 13, 2011,
in Mecklenburg County Superior Court, and was removed and
subsequently transferred to the Bankruptcy Court after the Brier
Creek Debtors filed for Chapter 11 bankruptcy protection in March
2012. Cary Creek is related to the Brier Creek Debtors through
common ownership, common property management, and common secured
and unsecured creditors.
CARY CREEK: Has OK to Hire Bidencope & Associates as Appraiser
--------------------------------------------------------------
Cary Creek Limited Partnership has obtained authorization from the
Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the
Eastern District of North Carolina to employ Damon Bidencope and
the firm of Bidencope & Associates to prepare a written appraisal
and to the extent needed, supporting testimony in deposition and a
trial, with respect to the fair market value of the Debtor's
property.
Bidencope agreed to represent the Debtor for (i) a flat fee in the
amount of $2,500 for the written appraisal; and (ii) additional
compensation for time and expenses incurred in connection with
preparation for and testimony in deposition or at trial, at
customary hourly rates, and subject to allowance and approval in
accordance with the provisions of the Bankruptcy Code.
About Cary Creek
Cary Creek Limited Partnership sought Chapter 11 protection
(Bankr. E.D.N.C. Case No. 13-00041) on Jan. 3, 2013.
Cary Creek is the owner of 1,009 acres of land located adjacent to
the west boundary of NC Highway 55 immediately sought of its
interchange with NC-540/I-540, in Cary, Wake County, North
Carolina. The property is managed by American Asset Corporation.
The primary secured creditor is Bank of America, N.A. BofA has a
first mortgage lien on the Debtor's property.
Cary Creek is seeking joint administration of its Chapter 11 case
with the consolidated Chapter 11 cases of Brier Creek Corporate
Center Associates Limited Partnership, et al., which sought
bankruptcy protection on March 9, 2012 (Bankr. E.D.N.C. Lead Case
No. 12-01855). Brier Creek, et al., own real property located in
Wake County, North Carolina and Mecklenburg County, North
Carolina.
Cary Creek and the Brier Creek Debtors are parties to litigation
pending in the Bankruptcy Court against BofA, Adv. Proc. No.
12-00121. The BofA litigation was instituted on Oct. 13, 2011,
in Mecklenburg County Superior Court, and was removed and
subsequently transferred to the Bankruptcy Court after the Brier
Creek Debtors filed for Chapter 11 bankruptcy protection in March
2012. Cary Creek is related to the Brier Creek Debtors through
common ownership, common property management, and common secured
and unsecured creditors.
CARY CREEK: Has Court Okay to Hire Rayburn as Litigation Counsel
----------------------------------------------------------------
Cary Creek Limited Partnership obtained permission from the Hon.
Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the
Eastern District of North Carolina to employ the law firm of
Rayburn Cooper & Durham, P.A., as special counsel, to represent
the Debtor in litigation brought by the Debtor against Bank of
America, N.A.
On Oct. 13, 2011, Cary Creek Limited Partnership and Brier Creek
Corporate Center Associates Limited Partnership, et al., filed a
complaint in Mecklenburg County Superior Court against Bank of
America, Case No. 11-CVS-19225. Rayburn Cooper is acting as
counsel for the Debtor and the Brier Creek Debtors in this
litigation, and Rayburn Cooper's representation of the Brier Creek
Debtors was approved by this Court by order entered on May 4,
2012, in the jointly administered cases for the Brier Creek
Debtors, Case Number 12-01855-8-SWH. After the filing of the
Brier Creek cases, the litigation was removed and subsequently
transferred to the U.S. Bankruptcy Court for the Eastern District
of North Carolina, Adversary Proceeding Number 12-00121-SWH.
The complaint seeks to enjoin Bank of America from foreclosing on
the Debtor's and the Brier Creek Debtors' real property, and seeks
damages and other relief pursuant to causes of action for breach
of contract, misrepresentation, slander of title, breach of the
implied duty of good faith and fair dealing, tortious interference
with business relations, fraudulent inducement, breach of
fiduciary duties, frustration of commercial purpose, unfair and
deceptive trade practices, and constructive fraud. Rayburn Cooper
would act as counsel for the Debtor in the event the Litigation is
arbitrated in whole or in part.
Rayburn Cooper will be paid at these hourly rates:
Attorneys
---------
Shelley K. Abel $280
Ramyn Atri $180
Paul R. Baynard $380
W. Scott Cooper $375
Albert F. Durham $475
Michelle E. Earp $180
Daniel J. Finegan $230
Ross R. Fulton $275
James B. Gatehouse $310
G. Kirkland Hardymon $310
David S. Melin $280
John R. Miller, Jr. $310
Ashley K. Neal $210
C. Richard Rayburn, Jr. $650
William S. Smoak, Jr. $260
Paralegals
----------
Kristy D. Godin $150
Lisa S. Kelly $125
Tiffany N. Lindsay $125
Julia L. Robinson $125
Wendy M. Schoolcraft $125
Elizabeth A Vincent $125
C. Richard Rayburn, Jr., a partner with the Firm, attested that
the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code.
About Cary Creek
Cary Creek Limited Partnership sought Chapter 11 protection
(Bankr. E.D.N.C. Case No. 13-00041) on Jan. 3, 2013.
Cary Creek is the owner of 1,009 acres of land located adjacent to
the west boundary of NC Highway 55 immediately sought of its
interchange with NC-540/I-540, in Cary, Wake County, North
Carolina. The property is managed by American Asset Corporation.
The primary secured creditor is Bank of America, N.A. BofA has a
first mortgage lien on the Debtor's property.
Cary Creek is seeking joint administration of its Chapter 11 case
with the consolidated Chapter 11 cases of Brier Creek Corporate
Center Associates Limited Partnership, et al., which sought
bankruptcy protection on March 9, 2012 (Bankr. E.D.N.C. Lead Case
No. 12-01855). Brier Creek, et al., own real property located in
Wake County, North Carolina and Mecklenburg County, North
Carolina.
Cary Creek and the Brier Creek Debtors are parties to litigation
pending in the Bankruptcy Court against BofA, Adv. Proc. No.
12-00121. The BofA litigation was instituted on Oct. 13, 2011,
in Mecklenburg County Superior Court, and was removed and
subsequently transferred to the Bankruptcy Court after the Brier
Creek Debtors filed for Chapter 11 bankruptcy protection in March
2012. Cary Creek is related to the Brier Creek Debtors through
common ownership, common property management, and common secured
and unsecured creditors.
CASTAIC PARTNERS: Case Dismissed, to Pay U.S. Trustee Fees
----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
entered an order dismissing the Chapter 11 case of Castaic
Partners, LLC; and directing the payment of unpaid quarterly fees
for the U.S. Trustee.
Peter C. Anderson, the U.S. Trustee has requested that the Court
convert, dismiss or appoint a Chapter 11 trustee in the case of
the Debtor.
The U.S. Trustee is granted a judgment in the amount of $975 for
quarterly fees due upon dismissal and related to the case.
About Castaic Partners
Castaic Partners LLC and affiliate Castaic Partners II filed
separate Chapter 11 petitions (Bankr. C.D. Cal. Case Nos. 12-36123
and 12-36116) in Los Angeles on July 30, 2012. Castaic Partners
owns 847 acres of unimproved land by Tapia Canyon Road, in
Castaic, California.
Castaic Partners LLC disclosed assets of $29.5 million and
liabilities of $23.98 million in its petition. The petition was
signed by William J. Barkett, managing member.
Castaic Partners I previously sought Chapter 11 protection in
October 2010 (Bankr. C.D. Cal. Case No. 10-53956). At that time,
the Debtor said the property was worth $29.5 million.
The Debtors are represented in the 2012 case by The Margulies Law
Firm APLC of Encino, California.
Judge Julia W. Brand presides over the case. She took over from
Judge Ernest M. Robles.
CAVE LAKES: Has No More Assets; Reorganization Case Dismissed
-------------------------------------------------------------
The Hon. Bruce A. Markell of the U.S. Bankruptcy Court for the
District of Nevada dismissed the Chapter 11 case of Cave Lakes
Canyon, LLC.
The Debtor, in seeking the dismissal, informed the Court that it
no longer has any assets.
The Debtor owned a project "Cave Lakes Canyon" and ordered an
appraisal. Unfortunately, the Debtor only had received a "Verbal
Appraisal Report," which gave the property an "as-is" value of
$17,300,000. Holt Family Holdings, owed $3.41 million under a
promissory note, won relief from the automatic stay with respect
to the Debtor's real property, and there is no chance of
reorganization without the property.
Cave Lakes Canyon LLC filed for Chapter 11 bankruptcy (Bankr. D.
Nev. Case No. 12-10008) on Jan. 3, 2012, disclosing $18,010,913 in
assets and $3,984,861 liabilities. Judge Bruce A. Markell
presides over the case.
CEDAR BAY: S&P Assigns Prelim. 'BB' Rating to $250MM Senior Debt
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' preliminary
rating to Cedar Bay Generating Co. L.P.'s $250 million senior
secured first-lien term loan B facility due 2020. The outlook is
stable, and the recovery rating is preliminary '1',
indicating S&P's expectation of very high (90% to 100%) recovery
in the case of a payment default.
The rating incorporates S&P's view of the following risks:
-- The project has an unfavorable energy margin. Although
project operations have been good during the past three
years, the project has experienced periods of high effective
forced outage rate in earlier years, and there is a risk
that either availability will be lower than projected, or
that operating and major maintenance expenses will be higher
than projected in the interest of addressing performance
issues. Much of the value in the plant is embedded in the
long-term power purchase agreement (PPA), but the project
will not likely be able to renegotiate this contract to
remove the basis differential.
-- The loan is floating rate, but the issuer covenants to hedge
at least 50% of the interest rate exposure for at least four
years. Cedar Bay buys 100% of its coal from an unrated
supplier, leaving the project exposed to market prices if
the supplier fails to deliver.
-- The plant faces potential exposure to carbon emission costs
in that the PPA does not pass through these costs, but the
likelihood of carbon-related legislation during the term of
the rated debt has diminished in the past year.
"The stable outlook reflects our view that Cedar Bay's negative
energy margin will not widen further than seen during the past
five years in the near term, our anticipation that the plant will
dispatch at lower levels than in recent years, and the benefit of
the cash sweep and the PPA and steam offtake that extend five
years beyond the loan maturity" said Standard & Poor's credit
analyst Ben Macdonald.
CENGAGE LEARNING: S&P Cuts CCR to 'CCC-' on Weak Performance
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Stamford, Conn.-based higher education publisher Cengage
Learning Holdings II L.P. to 'CCC-' from 'CCC'. The outlook is
negative.
S&P has lowered its issue-level ratings on the company's debt by
one notch in conjunction with the downgrade. S&P's recovery
ratings on the company's debt issues remain unchanged.
Total debt outstanding was $5.36 billion as of Dec. 31, 2012.
"The downgrade reflects the deterioration in the company's
liquidity profile and performance, and our expectation that the
company will likely default over the near term," said Standard &
Poor's credit analyst Hal Diamond.
"We believe the company will need an amendment to maintain
compliance with its senior secured leverage covenant. Also, the
company has $2.08 billion of low-cost term loans due July 2014,
which are trading at what we regard as a distressed yield. We
believe that the costs of refinancing would be prohibitive and
that the company may seek to restructure its debt," S&P added.
"We view Cengage's financial risk profile as "highly leveraged"
(based on our criteria) because of our expectation that the
company could default over the near term. We consider the
company's business risk profile as "weak," based on its eroding
business position in U.S. higher education and professional
training publishing, as well as enrollment declines facing for-
profit educational institutions. We assess company's management
and governance as fair, S&P noted
Cengage, the second largest U.S. college textbook publisher, has
recently lost market share, and lacks the breadth and financial
resources of Pearson PLC, the market leader. Cengage has been
adversely affected by the growth of the rental textbook market,
which has increased the availability of discounted books.
Cengage's sales to for-profit educational institutions are
declining, because these buyers are experiencing enrollment
pressures as a result of regulation that significantly tightens
their marketing practices. In addition, lower funding from state
and local governments is hurting the company's library reference
and school publishing businesses.
CENTRAL EUROPEAN: Cancels Exchange Offer Amid Roust Deal
--------------------------------------------------------
Central European Distribution Corporation on March 20 said it has
terminated its offer to exchange new common stock in CEDC for its
outstanding 3.00% Senior Notes due 2013, launched on Feb. 25,
2013, and amended on March 8, 2013, in light of the agreement
reached between Roust Trading and other noteholders. CEDC will
continue to solicit votes from the holders of the 2013 Notes on an
amended pre-packaged chapter 11 plan of reorganization that is
included in a supplement to the offering memorandum distributed by
CEDC in respect of the exchange offers.
CEDC has received a proposal for a financial restructuring of its
3% Convertible Notes due March 15, 2013. The proposal was jointly
made to CEDC by Roust Trading Ltd., who holds approximately $102.6
million principal amount of the 2013 Notes, and other beneficial
owners holding an aggregate of approximately $85.7 million in
outstanding principal amount of the 2013 Notes. Roust Trading and
the 2013 Steering Committee collectively hold approximately 73% of
the outstanding principal amount of the 2013 Notes.
After extensive discussion with representatives of Roust Trading
and the 2013 Steering Committee and deliberation regarding CEDC's
alternatives, the CEDC Board of Directors resolved unanimously to
terminate the 2013 Notes Exchange Offer and proceed with a vote on
the Amended Plan in support of the 2013 Notes Proposal.
Under the terms of the Roust Trading agreement with the 2013
Steering Committee, Roust Trading will make an offer to exchange,
subject to certain conditions, 2013 Notes not held by it -
approximately $155.3 million principal amount of the 2013 Notes -
for a pro rata share of an aggregate of $25 million in cash and an
aggregate principal amount of $30 million secured notes to be
issued by Roust Trading. Based on this proposal, holders of 2013
Notes participating in the RTL Exchange Offer would receive an
estimated recovery of 35.4% of principal amount on the 2013 Notes.
Alternatively, under the Amended Plan, holders of 2013 Notes and
Roust Trading's $20 million aggregate principal amount of
unsecured notes will receive a pro rata share of $16.9 million in
cash. Roust Trading and the 2013 Steering Committee have
announced that they collectively hold approximately 73% of the
outstanding principal amount of the 2013 Notes. Based on this
proposal, if the Amended Plan is approved by the requisite amount
of holders of Unsecured Notes, holders of 2013 Notes that do not
participate in the RTL Exchange Offer would receive an estimated
recovery of 6% of principal amount on the 2013 Notes.
The Supplement and Amended Plan also reflect the proposed
restructuring of the 2016 Notes. The economic terms remain
unchanged from those described in the Offering Memorandum.
CEDC has determined to make certain amendments to key dates
relating to the CEDC FinCo Exchange Offer, the Consent
Solicitation, and the solicitation of acceptances to the Plan of
Reorganization in light of the agreement reached between Roust
Trading and the 2013 Steering Committee, and following further
consultation with a Steering Committee of holders of approximately
30% of the outstanding principal amount of CEDC Finance
Corporation International, Inc.'s Senior Secured Notes due 2016 as
follows:
* the record date for the Consent Solicitation and the
solicitation of acceptances of the Plan of Reorganization
will be March 21, 2013;
* the Consent Fee Deadline and Early Voting Deadline will be
5:00 p.m. on April 3, 2013; and
* the Voting Deadline and Expiration Time will be 5:00 p.m. on
April 4, 2013.
CEDC is making these amendments to these key dates to allow
fulsome consideration of the Exchange Offers, the Consent
Solicitation and the Plan. In order to receive the Existing 2016
Notes Consideration, holders of 2016 Notes must validly tender and
not withdraw their 2016 Notes, at or prior to the Expiration Time.
To receive payment of cash pursuant to the Cash Option, the holder
of record of the applicable 2016 Notes on the Distribution Date
must have been the holder of record of the applicable 2016 Notes
electing the Cash Option as of March 21, 2013.
CEDC continues to believe that a successful restructuring will
improve its financial strength and flexibility and enable it to
focus on maximizing the value of its strong brands and market
position. The restructuring is expected to have no effect on
CEDC's operations in Poland, Russia, Hungary or Ukraine, all of
which will continue doing business as usual. Obligations to all
employees, vendors, and providers of credit support lines in
Poland, Russia, Hungary and Ukraine will be honored in the
ordinary course of business without interruption. CEDC believes
that its subsidiaries in Poland, Russia, Hungary and Ukraine have
sufficient cash and resources on hand to meet all those
obligations.
Maturity of 3% Convertible Notes
On March 15, 2013, CEDC failed to pay $257,858,000 principal due
on the 2013 Notes. Under the terms of the 2013 Notes Indenture,
the failure to pay principal when due constitutes an Event of
Default. In addition, under Section 6.2 of the Indenture
governing the 2016 Notes, the failure to pay principal when due on
the 2013 Notes constitutes an Event of Default under the 2016
Notes Indenture and, if continuing, holders of not less than 25%
of the aggregate principal amount of the outstanding 2016 Notes
may declare the principal plus any accrued and unpaid interest on
the 2016 Notes to be immediately due and payable. CEDC currently
has $380 million and EUR430 million (or approximately $559.4
million) of 2016 Notes outstanding.
CEDC intends to address the maturity of the 2013 Notes, as well as
the Event of Default under the 2016 Notes Indenture, through the
Exchange Offers. Alternatively, CEDC may choose to implement the
restructuring pursuant to a pre-packaged chapter 11 plan of
reorganization that is included with the offering materials
related to the Exchange Offers. As noted above, Roust Trading and
the 2013 Steering Committee, who collectively hold approximately
73% of the 2013 Notes, support a restructuring of the 2013 Notes
in accordance with the terms of their restructuring proposal.
Separately, the 2016 Steering Committee has stated that it
supports the terms of the restructuring of the 2016 Notes as
described in the Offering Memorandum.
Any chapter 11 filing would be limited solely to CEDC and CEDC
Finance Corporation International, Inc. None of CEDC's Polish,
Russian, Ukrainian or Hungarian operations would become the
subject of any insolvency proceedings. In this scenario, CEDC
anticipates that all its operations would continue without
interruption in the ordinary course, including the payment of all
employee, vendor, and other obligations.
Annual Meeting of Shareholders
In light of CEDC's current financial condition as well as the on-
going nature of CEDC's restructuring, the board of directors of
CEDC has determined to delay the annual meeting of CEDC's
shareholders currently scheduled for March 26, 2013, until
Tuesday, May 14, 2013.
CEDC Annual Report
CEDC said that its Annual Report on Form 10-K for the year ended
Dec. 31, 2012, could not be filed with the United States
Securities and Exchange Commission within the prescribed time
period as the process of preparing CEDC's financial statements for
the year ended Dec. 31, 2012, has been delayed due to the focus of
CEDC's resources on restructuring its financial obligations,
including preparation and commencement of the Exchange Offers,
negotiating with creditors and addressing open accounting issues
related to CEDCs financial restructuring. CEDC expects to file
its Annual Report on Form 10-K as soon as practicable.
A copy of the Amended Offering Memorandum is available at:
http://is.gd/0sbkfN
Term Sheet
According to a March 16 regulatory filing by CEDC, Roust Trading
Ltd., holder of 19.5% of outstanding common shares of CEDC, and an
ad hoc committee comprised of certain other beneficial owners
holding an aggregate of approximately $85.7 million in outstanding
principal amount of CEDC's 3% convertible notes due March 15,
2013, reached agreement on the material terms relating to a
proposed financial restructuring of CEDC. Together with the
approximately $102.6 million of Existing 2013 Notes owned by Roust
Trading, the agreement between Roust Trading and the Ad Hoc 2013
Notes Committee represents support for the Proposed 2013 Notes
Restructuring by approximately 73% of the outstanding principal
amount of Existing 2013 Notes.
Implementation of the Proposed 2013 Notes Restructuring would
require only minor amendments to CEDC's existing proposed
financial restructuring as reflected in the Company's offering
memorandum, consent solicitation and disclosure statement, dated
March 8, 2013, and the related plan of reorganization with respect
to which CEDC is currently soliciting votes. The Proposed 2013
Notes Restructuring, however, would not require any changes to the
proposed treatment with respect to the 2016 Notes. Roust Trading
is engaged in discussions with CEDC with respect to implementing
the Proposed 2013 Notes Restructuring through amendments to the
Offering Memorandum and related plan of reorganization although
CEDC has not yet made a determination to do so.
Pursuant to the Term Sheet, Roust Trading would make an offer to
purchase Existing 2013 Notes not held by Roust Trading as follows:
upon completion of the Proposed Restructuring, for each $1,000
outstanding principal amount of Existing 2013 Notes not owned by
Roust Trading who accept the offer and vote in favor of the
Amended Plan, Roust Trading would deliver a pro rata share of an
aggregate of $25 million in cash and an aggregate principal amount
of $30 million of secured notes issued by Roust Trading on the
terms described in the Term Sheet. Each accepting holder would
assign to Roust Trading all of its rights under such Existing 2013
Notes, including the right to its Pro Rata Stock Share.
If the Proposed 2013 Notes Restructuring is implemented through
the Amended Plan:
* If the class of claims consisting of Existing 2013 Notes and
RTL Notes votes to accept the Amended Plan, (i) each holder
of Existing 2013 Notes who does not agree to the RTL Notes
Purchase, (ii) the Existing 2013 Notes held by Roust Trading
and (iii) RTL Notes would receive, at the election of Roust
Trading in its sole discretion, either (x) its pro rata share
of 10% of the New Common Stock that is currently being
offered to the Existing 2013 Notes through the Offering
Memorandum; or (y) cash in an equivalent value to such
equity.
* If the class of claims consisting of Existing 2013 Notes and
RTL Notes does not vote to accept the Amended Plan, but the
Amended Plan becomes effective nonetheless, such class would
receive no recovery under the Amended Plan but Roust Trading
would remain obligated to complete the RTL Notes Purchase
Offer with respect to the Existing 2013 Notes validly
tendered to RTL in the RTL Notes Purchase Offer.
* Existing Common Stock would be cancelled and receive no
recovery.
The Replacement Notes would be issued by Roust Trading and
guaranteed by its affiliate Russian Standard Corporation, would
have a maturity date of May 31, 2016, and bear interest payable in
additional Replacement Notes or in cash at Roust Trading's sole
discretion, initially at 10% per annum, with a 1% step-up per
annum to a maximum of 12%. Interest would accrue from the earlier
of (i) the date of issuance of the Replacement Notes or
(ii) June 1, 2013. Roust Trading would pledge a portion of the
New Common Stock distributed to Roust Trading under the Amended
Plan representing 15% of the New Common Stock in the Issuer to
secure the Replacement Notes. RTL would be permitted to redeem a
portion or all of the Replacement Notes at any time without
penalty at 100% of the principal amount plus accrued and unpaid
interest.
On March 14, 2013, Roust Trading and the members of the Ad Hoc
2013 Notes Committee entered into a Plan Support Agreement
pursuant to which those parties agreed to support the Proposed
2013 Notes Restructuring subject to and in accordance with the
terms set forth therein. A copy of the Plan Support Agreement is
available at http://is.gd/hLfN2p
A copy of the 2013 Notes Term Sheet is available at:
http://is.gd/VVi5rz
About CEDC
Mt. Laurel, New Jersey-based Central European Distribution
Corporation is one of the world's largest vodka producers and
Central and Eastern Europe's largest integrated spirit beverages
business with its primary operations in Poland, Russia and
Hungary.
Ernst & Young Audit sp. z.o.o., in Warsaw, Poland, expressed
substantial doubt about Central European'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
certain of the Company's credit and factoring facilities are
coming due in 2012 and will need to be renewed to manage its
working capital needs.
The Company's balance sheet at Sept. 30, 2012, showed
US$1.98 billion in total assets, US$1.73 billion in total
liabilities, US$29.44 million in temporary equity, and US$210.78
million in total stockholders' equity.
Liquidity
The Company's Convertible Senior Notes are due on March 15, 2013.
The Company has said its current cash on hand, estimated cash
from operations and available credit facilities will not be
sufficient to make the repayment of principal on the Convertible
Notes and, unless the transaction with Russian Standard
Corporation is completed the Company may default on them. The
Company's cash flow forecasts include the assumption that certain
credit and factoring facilities coming due in 2012 would be
renewed to manage working capital needs. Moreover, the Company
had a net loss and significant impairment charges in 2011 and
current liabilities exceed current assets at June 30, 2012.
These conditions, the Company said, raise substantial doubt about
its ability to continue as a going concern.
* * *
As reported by the TCR on Aug. 10, 2012, Standard & Poor's
Ratings Services kept on CreditWatch with negative implications
its 'CCC+' long-term corporate credit rating on U.S.-based
Central European Distribution Corp. (CEDC), the parent company of
Poland-based vodka manufacturer CEDC International sp. z o.o.
"The CreditWatch status reflects our view that uncertainties
remain related to CEDC's ongoing accounting review and that
CEDC's liquidity could further and substantially weaken if there
was a breach of covenants which could lead to the acceleration of
the payment of the 2016 notes, upon receipt of a written notice
of 25% or more of the noteholders," S&P said.
As reported by the TCR on Jan. 16, 2013, Moody's Investors
Service has downgraded the corporate family rating (CFR) and
probability of default rating (PDR) of Central European
Distribution Corporation (CEDC) to Caa3 from Caa2.
"The downgrade follows CEDC announcement on the 28 of December
that it had agreed with Russian Standard a revised transaction to
repay its US$310 million of convertible notes due March 2013
which, in Moody's view, has increased the risk of potential loss
for existing bondholders", says Paolo Leschiutta, a Moody's Vice
President - Senior Credit Officer and lead analyst for CEDC.
CHAMPION INDUSTRIES: Incurs $3.5 Million Net Loss in 1st Quarter
----------------------------------------------------------------
Champion Industries, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $3.54 million on $22.61 million of total revenues
for the three months ended Jan. 31, 2013, as compared with a net
loss of $85,988 on $26.52 million of total revenues for the same
period a year ago.
The Company reported a net loss of $22.9 million in fiscal 2012,
compared with a net loss of $4.0 million in fiscal 2011.
The Company's balance sheet at Jan. 31, 2013, showed $43.81
million in total assets, $48.73 million in total liabilities and a
$4.91 million total shareholders' deficit.
Marshall T. Reynolds, Chairman of the Board and Chief Executive
Officer of Champion, said, "Our results continue to be impacted by
various non-cash events but we continue to generate positive cash
flow from operating activities. If we examine our gross profit,
which is a key starting point for profitability, our gross profit
dollars were $6.7 million in first quarter 2013 and $8.1 million
in first quarter 2012. However, this decrease was substantially
offset by a reduction in SG&A expenses of $1.3 million. In other
words, in spite of the numerous hurdles and challenges we have
faced and actions we have taken in recent years, in the final
analysis we were able to essentially hold our core business
relatively stable in the first quarter of 2013. We intend to work
with our secured creditors and advisors to address our debt
maturities and liquidity to the best of our ability and if
successful in stabilizing our funding platform going forward, we
believe our core business has the opportunity to improve."
A copy of the Form 10-Q is available for free at:
http://is.gd/Oou6dP
About Champion Industries
Champion Industries, Inc., is engaged in the commercial printing
and office products and furniture supply business in regional
markets east of the Mississippi River. The Company also publishes
The Herald-Dispatch daily newspaper in Huntington, West Virginia
with a total daily and Sunday circulation of approximately 23,000
and 28,000.
Arnett Foster Toothman PLLC, in Charleston, West Virginia,
expressed substantial doubt about Champion Industries' ability to
continue as a going concern following the fiscal 2012 annual
results. The independent auditors noted that the Company has
suffered recurring losses from operations and has been unable to
obtain a longer term financing solution with its lenders.
CHARLES STREET: Bank Seeks Dismissal of Chapter 11 Case
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the award for having one of the most contentious
bankruptcy reorganizations doesn't belong to a scrappy
manufacturing enterprise. Instead, it goes to Charles Street
African Methodist Episcopal Church of Boston and lender OneUnited
Bank who were battling years before the Chapter 11 reorganization
began one year ago in Boston.
According to the report, the disputes can't be pinned on racial
animus, because OneUnited described itself as the only black-owned
bank in Massachusetts.
The church has a reorganization plan on file that requires
confirmation over the bank's opposition. The bank just filed
another motion to dismiss the bankruptcy. The bankruptcy judge
set the matter for a five-day trial beginning April 12. The bank
claims the church has been grossly mismanaged and there isn't
enough cash to pay expenses of the bankruptcy.
Before and after bankruptcy, the church's lawyers from the Boston
firm Ropes & Gray LLP have been working free of charge.
The church won a victory in September when U.S. Bankruptcy Judge
Frank J. Bailey heard testimony from witnesses and wrote a 20-page
opinion deciding the bank isn't entitled to $5 million in so-
called default interest. Judge Bailey decided that the 18%
default rate called for in the contract meant that the interest
provision amounted to a penalty not permissible under
Massachusetts law.
About Charles Street
Charles Street African Methodist Episcopal Church --
http://www.csrrc.org/-- is located in Roxbury, Massachusetts.
The Church is to advocate for the needs of community residents and
to strengthen individuals, families, and the community by
providing social, educational, economic, and cultural services.
The Church filed for Chapter 11 protection (Bankr. D. Mass. Case
No. 12-12292) on March 20, 2012, to prevent its lenders, OneUnited
Bank, from foreclosing on a $1.1 million loan and auctioning off
the church.
The Debtor estimated both assets and debts of between $1 million
and $10 million.
The church is being represented by the Boston firm Ropes &
Gray LLP, which is also working for free.
CHILE MINING: Delays Financials for Dec. 31 Quarter
---------------------------------------------------
Chile Mining Technologies, Inc., was unable to file its Form 10-Q
within the prescribed time period without unreasonable effort or
expense due to the fact that the audit of the Company's financial
statements for the year ended Dec. 31, 2012, has not been
completed. The Company anticipates that it will file its Form 10-
Q within the five-day grace period provided by Exchange Act Rule
12b-25.
About Chile Mining
Chile Mining Technologies Inc. is a mineral extraction company
based in the Republic of Chile, with copper as its principal "pay
metal." Its founders, Messrs. Jorge Osvaldo Orellana Orellana and
Jorge Fernando Pizarro Arriagada, have refined the electrowin
process in a way that permits the electrowin process to be used at
a relatively small mine and/or tailings sites. Electrowinning is
a process in which positive and negative electrodes are placed in
an acidic solution containing copper ions, and an electric current
passed through the solution causes the copper to be deposited on
the negative electrodes so that it can be collected.
Schwartz Levitsky Feldman LLP, in Toronto, Ontario, Canada,
expressed substantial doubt about Chile Mining's ability to
continue as a going concern following the fiscal year ended
March 31, 2012, annual report. The independent auditors noted
that the continuance of the Company is dependent upon its ability
to obtain financing and upon future profitable operations from the
production of copper.
The Company reported a net loss of US$3.95 million on US$433,554
of sales in fiscal 2012, compared with a net loss of
US$7.25 million on US$188,227 of sales in fiscal 2011.
The Company's balance sheet at Sept. 30, 2012, showed US$8.72
million in total assets, US$11.24 and a US$2.51 million
stockholders' deficiency.
CHINA EDUCATION: Gets SEC Letter Over Auditor Non-Compliance
------------------------------------------------------------
China Education Alliance, Inc. on March 21 disclosed that it has
received a letter from the Securities and Exchange Commission
regarding the non-compliance of its former auditor.
On March 16, 2013, China Education Alliance received a letter from
the Securities and Exchange Commission dated March 15, 2013
informing the Company that the Chief Accountant of the Commission
had received a PCAOB Form 3 report issued by the Company's former
independent accountant, Sherb & Co., LLP stating that it had
notified the Company on February 14, 2013 that Sherb was not in
technical compliance with the concurring partner rotation rules of
Auditing Standard No. 7 and consequently, Sherb's audit report
dated April 12, 2011 on the financial statements for the years
ended December 31, 2010 and 2009 could not be relied upon.
China Education Alliance never received the Sherb Letter or any
notification from Sherb -- at any time during or after Sherb's
engagement as the Company's independent accountant -- of Sherb's
non-compliance.
However, upon written request, the Company obtained a copy of the
Sherb Letter dated January 31, 2013 on March 20, 2013. The Sherb
Letter stated that Sherb was not in technical compliance with the
concurring partner rotation rules of the PCAOB on certain prior
audit and review engagements that they performed. The engagements
affected were the audit for the year ended December 31, 2010 and
the reviews for the interim periods ended March 31, 2010, June 30,
2010, September 30, 2010, March 31, 2011, June 30, 2011 and
September 30, 2011. As a result of the foregoing, Sherb stated
that the Company may no longer place reliance on their audit
report and review for such periods.
China Education Alliance's Board of Directors and management
continue to believe that the affected audit and reviewed reports
fairly present, in all material aspects, the Company's financial
condition and results of operations as of the end of and for the
periods presented.
The audit for the year ended December 31, 2011 was performed by
Baker Tilly Hong Kong, a member of the Baker Tilly International
accountancy and business advisory network.
The Company will take whatever action necessary on behalf of its
shareholders to rectify Sherb's non-compliance and default.
About China Education
China Education Alliance, Inc. --
http://www.chinaeducationalliance.com-- is a China-based
education resource and services company.
CIRCLE STAR: Incurs $1.5 Million Net Loss in Jan. 31 Quarter
------------------------------------------------------------
Circle Star Energy Corp. filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $1.56 million on $267,929 of total revenues for the
three months ended Jan. 31, 2013, as compared with a net loss of
$2.05 million on $255,935 of total revenues for the same period
during the prior year.
The Company's balance sheet at Jan. 31, 2013, showed $4.74 million
in total assets, $5.49 million in total liabilities and a $754,119
total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/4d9T28
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.
CLUB AT SHENAND: Proofs of Claims Due April 29
----------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
established April 29, 2013, as the deadline for any individual or
entity to file proofs of claim against The Club At Shenandoah
Springs Village, Inc. The Court also set Aug. 29, 2013, as the
governmental entities bar date.
About The Club At Shenandoah
The Club At Shenandoah Springs Village, Inc., owns The Club At
Shenandoah Springs Village, a golf and leisure resort in Thousand
Palms, a desert region of central California. It filed for
Chapter 11 protection (Bankr. C.D. Cal. Case No. 12-36723) on
Dec. 3, 2012. The Debtor disclosed $31,280,992 in assets and
$12,840,954 in liabilities as of the Chapter 11 filing. Judge
Mark D. Houle presides over thee case. Daniel A. Lev, Esq., at
Sulmeyerkupetz, represents the Debtor.
CMS ENERGY: Fitch Rates $250MM Senior Unsecured Notes 'BB+'
-----------------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to CMS Energy Corp.'s
$250 million issuance of 4.70% senior unsecured notes, due
March 31, 2043. Proceeds from the sale will be used primarily to
repay at, or prior to maturity the $250 million 2.75% senior note,
due 2014. The new notes rank equally in right of payment with
existing senior unsecured obligations of CMS. The Rating Outlook
is Positive.
Key Rating Drivers:
-- CMS' ownership of a regulated integrated utility with a low-
risk stable credit profile;
-- Fitch's assessment of the regulatory environment in Michigan
as supportive;
-- The up to $7 billion five-year capital spending plan is
consistent with management's strategy to invest in its
regulated operations;
-- Fitch sees limited opportunity for parent company de-
leveraging over the next five-year period;
-- A sufficient liquidity position relative to funding needs.
Positive Outlook for CMS:
CMS' rating and Positive Outlook are supported by ownership of
Consumers Energy Co. (IDR 'BBB', Stable Outlook'), an integrated
regulated utility located in Michigan with a stable credit
profile. Consolidated financial metrics are improving, largely due
to a strong utility financial profile. Fitch forecasts EBITDA to
interest at or near 4.0 times (x) through 2017, which is
consistent with its guidelines for the 'BBB-' rating category.
Fitch's forecast for FFO to debt ranges between 18% - 15% over the
forecast period, and reflects the positive cash benefits
associated with the recent extension of bonus depreciation, which
coupled with the company's NOLs outstanding means CMS will not pay
cash taxes earlier than 2017.
Fitch continues to monitor the company's financing activity as the
high nominal level of parent debt is a legacy credit concern. At
Sept. 30, 2012 total parent debt was nearly $2.4 billion, or 33%
of total consolidated debt (Fitch adjusted) and 23% of total
capital (Fitch adjusted). Fitch sees limited opportunity for
parent company de-leveraging over the next five-year period due to
a large utility capital plan, and expects the parent to maintain
the utility capital structure during this capital intensive
period. A disproportionate growth in the already high level of
parent company debt could place pressure on the parent company
rating.
Large Capital Plan:
The five-year capital investment plan has been increased to up to
$7 billion to accommodate a late 2012 announcement to construct a
new 700 MW natural gas plant in Michigan. Fitch expects capital
spending levels will remain high over the five-year forecast
period, with the plan focused on delivering utility system
upgrades and rate base growth. CMS can expect to earn a good
return on its investment and the current regulatory environment
supports timely recovery of capital costs incurred. Execution of
the capital plan and timely cost recovery are key to maintaining
credit quality.
Solid Liquidity Profile:
CMS had a consolidated liquidity position of $1.3 billion at Dec.
31, 2012, including nearly $1.2 billion in availability under
three separate multi-year bank credit facilities, and $93 million
in cash on hand. Fitch considers the company's liquidity position
as sufficient relative to funding needs. The execution of multi-
year credit facilities mitigates concern related to both liquidity
and bank credit market access. Additionally, of the $1.2 billion
consolidated bank credit capacity no one bank is exposed for
greater than 6.43% or $77.2 million.
Manageable Debt Maturity Schedule:
Fitch considers the consolidated debt maturity schedule to be
manageable, with $0 due in 2013, $450 million due in 2014, $650
million due in 2015, $530 million due in 2016, and $600 million
due in 2017. Fitch views the re-financing risk as low.
Rating Sensitivities:
Continued improvement in parent company financial metrics could
lead to a ratings upgrade.
Execution of a large capital investment plan and related capital
funding needs limits positive rating action for Consumers Energy
Co. at this time.
An adverse regulatory order that negatively impacts the financial
position of Consumers Energy Co. could place pressure on both the
parent company and subsidiary ratings.
COMMUNITY FIRST: Reports $3 Million Net Income in 2012
------------------------------------------------------
Community First, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing net income of
$3.04 million on $22.72 million of total interest income for the
year ended Dec. 31, 2012, as compared with a net loss of
$15.05 million on $28.68 million of total interest income during
the prior year.
The Company's balance sheet at Dec. 31, 2012, showed
$510.71 million in total assets, $500.37 million in total
liabilities, and $10.33 million in total shareholders' equity.
"[T]he Company is subject to a written agreement with its primary
regulator, which among other things restricts the payment of
interest on subordinated debentures and outstanding preferred
stock. The Company is in substantial compliance with this
agreement. The Company's bank subsidiary, Community First Bank &
Trust (the "Bank"), is not in compliance with a regulatory
enforcement action issued by its primary federal regulator
requiring, among other things, a minimum Tier 1 Leverage capital
ratio of not less than 8.5%. The Bank's Tier 1 Leverage capital
ratio was 6.46% at December 31, 2012. Continued failure to comply
with the regulatory action may result in additional adverse
regulatory action."
A copy of the Form 10-K is available for free at:
http://is.gd/Z9yTUN
About Community First
Columbia, Tennessee-based Community First, Inc., is a registered
bank holding company under the Bank Holding Company Act of 1956,
as amended, and became so upon the acquisition of all the voting
shares of Community First Bank & Trust on Aug. 30, 2002. An
application for the bank holding company was approved by the
Federal Reserve Bank of Atlanta (the "FRB") on Aug. 6, 2002. The
Company was incorporated under the laws of the State of Tennessee
as a Tennessee corporation on April 9, 2002.
COMSTOCK MINING: Incurs $30.7 Million Net Loss in 2012
------------------------------------------------------
Comstock Mining Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$30.76 million on $5.13 million of total revenues for the year
ended Dec. 31, 2012, as compared with a net loss of $11.60 million
on $473,386 of total revenues in 2011. The Company incurred a net
loss of $60.32 million in 2010.
The Company's balance sheet at Dec. 31, 2012, showed $47.86
million in total assets, $29.46 million in total liabilities and
$18.39 million in total stockholders' equity.
A copy of the Form 10-K is available for free at:
http://is.gd/WmJE1O
About Comstock Mining
Virginia City, Nev.-based Comstock Mining Inc. is a Nevada-based,
gold and silver mining company with extensive, contiguous property
in the historic Comstock district. The Company began acquiring
properties in the Comstock in 2003. Since then, the Company has
consolidated a substantial portion of the Comstock district,
secured permits, built an infrastructure and brought the
exploration project into test mining production. The Company
continues acquiring additional properties in the Comstock
district, expanding its footprint and creating opportunities for
exploration and mining. The goal of the Company's strategic plan
is to deliver stockholder value by validating qualified resources
(measured and indicated) and reserves (probable and proven) of
3,250,000 gold equivalent ounces by 2013, and commencing
commercial mining and processing operations by 2011, with annual
production rates of 20,000 gold equivalent ounces.
CONTRACTOR TECH: Porter Hedges Dodges $1M Client Conflict Suit
--------------------------------------------------------------
Jeremy Heallen of BankruptcyLaw360 reported that a Texas appeals
court on Thursday declined to revive a construction company's
$1 million malpractice suit against Porter Hedges LLP, over the
firm's simultaneous representation of the company and the
bankruptcy trustee of a general contractor that held a judgment
against it. The Fourteenth Court of Appeals ruled that Workzone
Technologies could not recover fees Porter Hedges was paid for
serving as special litigation counsel to the bankruptcy trustee of
Contractor Technology Inc. while also representing Workzone.
About Contractor Technology
Headquartered in Houston, Texas, Contractor Technology, Ltd.
-- http://www.ctitexas.com/-- is a producer of recycled concrete
and asphalt. The Company filed for chapter 11 protection on
May 13, 2005 (Bankr. S.D. Tex. Case No. 05-37623). When the
Debtor filed for protection from its creditors, it scheduled
its assets at $20,225,000 to $64,241,000, and was unable to
tabulate its liabilities. On June 23, 2005, the Honorable
Marvin Isgur converted the Debtor's Chapter 11 bankruptcy
case to a Chapter 7 liquidation proceeding and Ronald J.
Sommers was appointed as the Chapter 7 Trustee.
COPYTELE INC: Incurs $2.1 Million Net Loss in Jan. 31 Quarter
-------------------------------------------------------------
Copytele, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $2.09 million on $2,130 of total net revenue for the three
months ended Jan. 31, 2013, as compared with a net loss of
$886,085 on $449,195 of total net revenue for the same period
during the prior year.
The Company's balance sheet at Jan. 31, 2013, showed $7.52 million
in total assets, $8.84 million in total liabilities and a $1.32
million total shareholders' deficiency.
A copy of the Form 10-Q is available for free at:
http://is.gd/JReMTK
About CopyTele
Melville, N.Y.-based CopyTele, Inc.'s principal operations include
the development, production and marketing of thin flat display
technologies, including low-voltage phosphor color displays and
low-power passive E-Paper(R) displays, and the development,
production and marketing of multi-functional encryption products
that provide information security for domestic and international
users over several communications media.
Copytele Inc. incurred a net loss of $4.25 million for the year
ended Oct. 31, 2012, compared with a net loss of $7.37 million
during the prior fiscal year.
KPMG LLP, in Melville, New York, issued a "going concern"
qualification on the consolidated financial statements for the
fiscal year ended Oct. 31, 2012. The independent auditors noted
that the Company has suffered recurring losses from operations,
has negative working capital, and has a shareholders' deficiency
that raise substantial doubt about its ability to continue as a
going concern.
CORRECTIONS CORP: Fitch Rates New $675MM Unsecured Notes 'BB+'
--------------------------------------------------------------
Fitch Ratings assigns a 'BB+' rating to Correction Corporation of
America's (CCA) proposed $675 million senior unsecured notes due
2020 and 2023, and a 'BBB-' to the amended revolving credit
facility. CCA's Issuer Default Rating (IDR) is 'BB+' and the
Rating Outlook is Stable.
The new bond issuance and upsized revolver are a result of the
company's conversion (effective Jan. 1, 2013) from a C-Corp to a
REIT with a Taxable REIT Subsidiary structure.
Proceeds from the issuance will be used to refinance $465 million
of outstanding 7.75% senior notes due 2017, to pay the cash
portion of an E&P (earnings & profits) dividend, and for roughly
$70 million in other costs associated with the transaction and
REIT conversion.
For lenders that agree to the amend & extend terms, the existing
revolving credit facility is being extended to a December 2017
expiration from 2016 and upsized to as much as $900 million from
$785 million, which will provide additional liquidity to offset
the weaker free cash flow (FCF) profile. The amended credit
facility will have a $100 million accordion feature.
KEY RATING DRIVERS
The REIT conversion does not place pressure on the ratings or
Rating Outlook, as discussed in Fitch's rating comment on Jan. 31,
2013, available at www.fitchratings.com. However, Fitch does view
CCA's REIT conversion as a slight negative from a credit
perspective, driven primarily by the requirement to distribute at
least 90% of taxable income to shareholders per regulations
governing REITs. Fitch estimates the increased dividends will more
than offset the potential tax savings and deteriorate the FCF
profile by roughly $90 million as compared to the company pre-REIT
conversion.
While this will restrain the company's ability to build more than
one new correctional facility per year with FCF, management has
increased its internal minimum liquidity threshold, which
mitigates the increased reliance on consistent capital market
access to grow and refinance indebtedness.
CCA will retain a strong financial profile in Fitch's view, as
total leverage will increase to around 3x pro forma for the new
issuance (from 2.5x), in line with prior expectations. Leverage
through the secured credit facility at Dec. 31, 2012 will remain
neutral at 1.5x, but it increases to roughly 2x on a fully drawn
basis (from 1.8x) if the amend & extend is fully executed, given
the upsized commitment.
At Dec. 31, 2012, Fitch calculated funds from operations (FFO)
less maintenance capex of roughly $237 million for CCA and expects
this to increase sizably for 2013 by roughly $50 million-$55
million, reflecting tax savings from the REIT conversion,
partially offset by a slight decline in EBITDA. On a forward-run
rate basis, this results in roughly $290 million-$300 million of
annual FFO less maintenance capex.
This strong and stable stream of cash flow will be used to support
the large recurring dividend commitments, which Fitch estimates to
be roughly $215 million-$220 million on a run rate basis going
forward (excluding the one-time E&P distribution). It should also
be able to support fluctuations in accounts receivable, as well as
other discretionary items including some prison construction,
share repurchases, additional dividends, and/or paying down the
balance on the revolver ($655 million at Dec. 31, 2012).
CCA's debt maturity profile is attractive. The only debt in the
pro forma capital structure consists of $655 million on the
revolver whose December 2016 maturity will be pushed out to
December 2017 (if the amend & extend is fully executed), and the
proposed $675 million of unsecured notes due 2020 and 2023.
The secured credit facility is rated 'BBB-', one notch above the
IDR. CCA's accounts receivables are pledged as collateral, which
totaled $252 million as of Dec. 31, 2012. Equity in the company's
domestic operating subsidiaries and 65% of international subs is
also pledged as collateral, but long-term fixed assets are not
pledged.
The secured debt market for prisons remains undeveloped and is
unlikely to become as deep as that for other commercial real
estate asset classes, weakening the contingent liquidity provided
by CCA's unencumbered asset pool. Fitch would view more positively
an increase in institutional secured lender interest for prisons
through business cycles, as this increase would mitigate the
reduced financial flexibility stemming from the conversion. Fitch
expects that the company will retain strong access to capital via
the unsecured bank, bond and equity markets, given Fitch's
expectation for strong credit metrics that are supported by the
niche property type's stable cash flows derived from providing
essential governmental services.
Financial Policies
Following the conversion to REIT status with a TRS structure,
Fitch continues to expect the company will manage leverage to
around 3x when allocating capital toward additional share
repurchases and/ or dividends.
The 'BB+' IDR incorporates CCA's financial policies, including the
willingness to increase leverage to a cap of around 4x that would
only be reached via opportunistic growth investments such as
facility acquisitions and/or construction of multiple facilities
in a relatively short period of time. The timing of such growth
opportunities is difficult to predict, returns on capital have
been attractive, and its main competitor (GEO) is more highly
leveraged, all of which support the potential for leverage to
increase.
In the event leverage were to increase to the 4x range due to
growth opportunities, Fitch expects that discretionary capital
allocation policies would shift toward reducing leverage to around
3x within a relatively short period. However, the reduced FCF
profile from the REIT conversion will limit the company's ability
to deleverage quickly, so the timing of any deleveraging could be
influenced by its willingness to issue equity to partially fund
any growth opportunities.
Additionally, CCA has increased its internal minimum liquidity
threshold as noted above. Fitch expects the company to manage
liquidity to this higher level, which gives it ample flexibility
to potentially build multiple facilities simultaneously,
offsetting its weaker pro forma FCF profile.
Solid Secular Credit Factors and Competitive Position
The 'BB+' IDR considers the industry structure and other credit
characteristics of private correctional facilities, which Fitch
believes will remain attractive for the long term, as described
more fully in the January comment.
A lingering concern has been the concentration of the company's
customers, which is exemplified by ongoing uncertainty regarding
contracts with the California Department of Corrections and
Rehabilitation (CDCR). CDCR made up 12% of total revenue for 2012,
and revenue will be under pressure in the coming years, depending
on the pace of successful implementation of changes proposed in
California's corrections realignment program and whether or not
federal judges uphold their prior rulings centered on CDCR prison
population reduction. Fitch's base case assumes material declines
in business from California, but there is ample cushion for
operating declines within the context of the 'BB+' IDR.
Limited Real Estate Value
Based on a cost of $60,000 per bed, the replacement cost of the
company's 47 facilities is around $4 billion, which compares to
roughly $1.1 billion of debt and a current enterprise value of
$4.9 billion.
The company's real estate holdings provide only modest credit
support in Fitch's view. There are limited alternative uses of
prisons, the properties are often in rural areas, and there is no
established mortgage market as a contingent liquidity source.
However, the facilities do provide essential governmental
services, so there is inherent value in the properties. Also,
prisons have a long depreciable life (50 years) with a practical
useful life greater than that (equivalent to 75 years), and CCA
has a young owned portfolio (median age of 16 years).
Rating Sensitivities
Considerations for an investment grade IDR include the following:
-- Further penetration and public acceptance of private
correctional facilities;
-- An acceleration of market share gains and/or contract wins;
-- Adherence to more conservative financial policies (2.0x
leverage target; 4.0x minimum fixed charge coverage);
-- Increased mortgage lending activity in the private prisons
sector.
Considerations for downward pressure on the 'BB+' IDR and/or
Stable Outlook include:
-- Increased pressure on per diem rates from customers;
-- Decreasing market share gains and/or notable contract losses;
-- Material political decisions related to long-term dynamics of
the private correctional facilities industry;
-- Leverage sustaining above 4.0x and FFO fixed charge coverage
sustaining below 4.0x.
CORRECTIONS CORP: Moody's Affirms 'Ba1' Senior Debt Rating
----------------------------------------------------------
Moody's Investors Service revised the rating outlook for
Corrections Corporation of America to positive from stable, and
affirmed the senior unsecured rating at Ba1. The rating agency
also assigned a Ba1 senior unsecured rating to the new $675
million seven- and ten-year notes.
The following rating was affirmed with a positive outlook:
Corrections Corporation of America -- Ba1 senior unsecured.
The following rating was assigned with a positive outlook:
Corrections Corporation of America $675 million Notes -- Ba1
senior unsecured.
Ratings Rationale:
"CCA's ability to uphold occupancies and maintain its solid credit
profile throughout the recession is indicative of a higher rating
which is also suggested by our methodology scorecard," said Chris
Wimmer, vice president.
The rating outlook improvement is driven primarily by CCA's
balance sheet which reflects management's conservative approach,
highlighted by low leverage and no secured debt, as well as a
largely unencumbered asset base. CCA has successfully achieved
prudent growth in an industry characterized by persistent demand
for corrections beds while maintaining a solid roster of
investment grade customers. Moreover, CCA upholds a good liquidity
profile with no debt maturities until December 2017.
In contrast, the rating agency noted several credit challenges,
the first of which pointed out that alternative use for
correctional facilities is lacking, particularly in rural locales,
and that CCA's business is especially reliant on the government
appropriations process. As such, government budgetary pressures
could lead to payment delays, contract cancellations or inmate
population declines. Finally, headline risk requires careful
public relations management while legal and political issues slow
or impede growth in many states.
The positive ratings outlook reflects Moody's belief that CCA will
fill its unoccupied beds and continue to prudently grow the number
of beds it owns and operates while maintaining its solid credit
profile. Moody's also expects that margins - supported by a higher
portion of more profitable wholly-owned beds - will remain above
20% and that secured debt will remain mostly absent from the
balance sheet while the company maintains its leadership.
Moody's indicated that a higher rating would be commensurate with
CCA continuing as the leading owner and operator of beds in the US
adult private corrections industry and all private corrections
beds continuing to account for a greater proportion of all US
corrections beds. In addition, continued growth in gross assets
above $4 billion coupled with continued growth in revenues above
$1.8 billion without deterioration in leverage or coverage levels
and with little or no secured debt would likely result in positive
ratings momentum. A seamless transition to the REIT structure is
also a prerequisite for upward rating movement, including prudent
management of its new dividend policy.
Conversely, CCA's rating outlook would likely be revised to stable
at a minimum and further downward ratings pressure could result
from sustained total debt 4x or greater than EBITDA, fixed charge
coverage less than 4x, managed-only beds in excess of 25% of
EBITDA and secured debt approaching 10% of gross assets.
Furthermore, a sudden and material loss of contracts which results
in total occupancy loss of 10% or more or revenues dropping below
$1.5 billion would likely result in downward rating pressure.
The last rating action with respect to CCA was on June 3, 2011,
when the company's rating was raised to Ba1 from Ba2 and the
outlook was changed to stable from positive.
Corrections Corporation of America [NYSE: CXW] is a real estate
investment trust with headquarters in Nashville, TN. CCA is the
nation's largest owner of partnership correction and detention
facilities and one of the largest prison operators in the United
States, behind only the federal government and three states. CCA
owns or controls 51 facilities and currently operates 67
facilities, with a total design capacity of approximately 92,500
beds in 20 states and the District of Columbia. CCA specializes in
owning, operating and managing prisons and other correctional
facilities and providing inmate residential services for
governmental agencies. In addition to providing the fundamental
residential services relating to inmates, the company's facilities
offer a variety of rehabilitation and educational programs,
including basic education, religious services, life skills and
employment training and substance abuse treatment.
CORRECTIONS CORP.: S&P Ups CCR to BB+; Rates New Unsec. Notes BB+
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised the corporate credit
rating on Nashville-based Corrections Corp. of America (CCA) to
'BB+' from 'BB'. The outlook is stable.
S&P also assigned a 'BB+' issue rating to the company's proposed
$675 million senior unsecured notes. The recovery ratings are
'3', which indicates S&P's expectation of meaningful recovery (50%
to 70%) for senior unsecured creditors in the event of a payment
default.
S&P also raised the issue rating on the company's existing
$465 million senior unsecured notes due 2017 to 'BB+' from 'BB',
with the recovery rating remaining '3'. S&P will withdraw these
ratings after the refinancing transaction.
"We expect that credit metrics can return to levels of prior to
the proposed refinancing, including leverage below 3x, even though
the refinancing is increasing debt in conjunction with the REIT
conversion," said Standard & Poor's credit analyst Brian Milligan.
"We believe internally generated cash flow will exceed shareholder
distributions and the company will gradually reduce revolver
borrowings following the refinancing."
The ratings on CCA reflect Standard & Poor's assessment that the
company's business risk profile continues to be "fair." The
company benefits from high barriers to entry in the private
correctional industry. Ongoing government budget deficits and
potential correctional policy changes, coupled with high customer
concentration, are the principal constraining factors in S&P's
business risk assessment. S&P believes these factors will
restrict organic growth through at least 2014.
S&P believes CCA's financial risk profile will remain
"significant," though it has the potential to improve to
"intermediate" over the next one to two years, assuming financial
policy remains moderate. The company is generally cash flow
positive every quarter throughout its fiscal year. S&P forecasts
free cash flow of $160 million in 2013 and nearly $250 million in
2014.
S&P could lower the ratings if CCA's operating performance
significantly misses S&P's forecast, or if financial policy
becomes more aggressive. Though unlikely, S&P could raise the
ratings to investment-grade if CCA's business risk profile
strengthens to the "satisfactory" category and its financial risk
profile improves to "intermediate," including leverage of 2x. S&P
could also raise the ratings if CCA's business risk profile
remains "fair" but its financial risk profile improves to
"modest," including leverage below 1.5x.
CROWN MEDIA: Moody's Rates New $30MM Revolver Debt 'Ba2'
--------------------------------------------------------
Moody's Investor Service assigned a Ba2 rating to Crown Media
Holdings, Inc.'s proposed $30 million senior secured super
priority revolver due January 2018 and said that the Ba2 rating on
the existing senior secured term loan due July 2018 is not
affected by the company's proposed re-pricing of its credit
facility.
Crown Media intends to utilize the proceeds from the revised $172
million term loan along with existing cash to refinance its
existing $188 million term loan with the pay down favorably
reducing debt-to-EBITDA leverage to 4.3x from 4.4x (incorporating
Moody's standard adjustments and programming costs on a cash
basis). The rating assignment does not affect Crown Media's B2
Corporate Family Rating Rationale:, B2-PD Probability of Default
Rating, SGL-2 speculative-grade liquidity rating, B3 senior
unsecured note rating or the stable rating outlook. Moody's
updated the loss given default assessments based on the revised
debt mix.
The approximate $3 million reduction in annual cash interest
expense as part of the refinancing favorably improves free cash
flow. Crown Media and its 90% shareholder Hallmark Cards, Inc.
(Hallmark; not rated by Moody's) also completed a tax
reorganization in October 2012 that will allow Crown Media to
utilize the $692 million of net operating losses it incurred prior
to March 2003. This will reduce Crown Media's cash taxes (roughly
$19.5 million in 2012) and improve its free cash flow. Moody's
expects Crown Media will utilize the incremental cash flow to
increase its investment in original programming, and to continue
to repay debt. Required debt payments consist of 1% required
annual term loan amortization and a 50% excess cash flow sweep,
but Crown Media has indicated its plans to continue to utilize
excess cash to repay debt. There are no other material changes to
the prior credit facility terms including the guarantee and
collateral package, or the financial maintenance covenants.
Assignments:
Issuer: Crown Media Holdings, Inc.
Senior Secured Bank Credit Facility Jan 14, 2018 (Revolver),
Assigned Ba2, LGD1 - 1%
LGD Updates:
Issuer: Crown Media Holdings, Inc.
Senior Secured Bank Credit Facility July 14, 2018 (Term Loan
B), Changed to LGD2 - 13% from LGD2 - 14% (no change to Ba2
rating)
Senior Unsecured Regular Bond/Debenture July 15, 2019, Changed
to LGD4 - 68% from LGD4 - 69% (no change to B3 rating)
Ratings Rationale:
Crown Media's B2 CFR reflects the company's small size and niche
market position among cable network operators, concentration in
two Hallmark-branded channels, reliance on licensed third party
content for a majority of its programming, and high leverage. The
company generates a higher percentage of its revenue from cyclical
advertising (approximately 77% FY 12/31/12) than most other cable
network operators. The decline in audience ratings at the Hallmark
Channel since 2007 is a credit concern, although ratings
stabilized in 2012. A portion of this deterioration is
attributable to the shift of some programming to the Hallmark
Movie Channel, which was launched in 2004 and became Nielsen-rated
in April 2010. However, Moody's also believes meaningful reliance
on syndicated reruns of programming that has been off network for
a number of years contributes to the ratings performance and
results in a relatively high median-aged audience that is less
attractive to advertisers. Crown Media is favorably positioned
within the B2 CFR based on its recent strong growth performance,
and debt and leverage reduction since the July 2011 refinancing.
However, the niche market position, risk from an uncertain
economic environment on Crown Media's advertising-heavy model, and
the company's ramp up in programming investment to support its
entry into prime-time scripted shows as well as other programming
initiatives currently limit rating upside.
Debt-to-EBITDA leverage is projected to remain in a mid 4x range
in 2013 and 2014 with mid-single digit revenue growth and
continued debt reduction partially offset by the ongoing ramp up
in programming investment. Moody's expects cash programming
outlays will continue to exceed programming amortization over the
next few years. Because Moody's utilizes the cash programming
outlays in its EBITDA calculation, its leverage estimate is higher
than a calculation based on reported programming amortization.
The liens securing the super-priority revolver are pari passu with
the collateral for the term loan. However, proceeds from the
collateral in the event of a credit agreement default are applied
to the revolver until it is paid in full prior to any
distributions to the term loan lenders. As a result, the revolver
incrementally benefits from priority relative to the term loan and
it has a lower loss given default assessment (Ba2, LGD1 - 1%) than
the term loan (Ba2, LGD2 - 13%). Moody's plans to withdrawal the
rating on the existing $30 million revolver due July 2016 once the
facility is terminated as part of the refinancing.
The stable rating outlook reflects Moody's view that the U.S.
economy will continue to grow modestly, but also that uncertainty
surrounding global sovereign debt issues could create volatility
in the economy and client advertising spending. Moody's
anticipates Crown Media's commercial arrangements and relationship
with majority owner Hallmark will not change materially, and that
Crown Media will continue to grow its programming investment.
Moody's project Crown Media will generate modest free cash flow,
steadily reduce debt to increase financial flexibility, and
maintain a good liquidity position.
An upgrade could occur if the company gains traction with its
original programming investments such that viewership ratings
improve, generates profitable revenue growth, reduces debt,
sustains debt-to-EBITDA comfortably below 5x, and sustains free
cash flow-to-debt above 6%. The company would also need to
maintain a good liquidity position. More explicit credit support
from Hallmark could also result in an upgrade if Moody's viewed
Hallmark as having the capacity and willingness to favorably
affect Crown Media's financial position.
Crown Media's ratings could be downgraded if the terms of its
commercial arrangements or relationship with Hallmark were to
change meaningfully, audience ratings decline, debt-to-EBITDA
leverage exceeds 6.25x, or free cash flow-to-debt is below 2%. In
addition, a deterioration in Crown Media's liquidity position
including a decline in cash flow generation or the margin of
compliance with covenants could also lead to a downgrade.
The principal methodology used in this rating was the Global
Broadcast and Advertising Related Industries Methodology published
in May 2012. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.
Crown Media, headquartered in Studio City, CA is a media
distribution company with revenue of $350 million for the last
twelve months-ended December 31, 2012. The company supplies
television programming to cable, direct broadcast satellite and
telecommunications service providers throughout the United States
via the Hallmark Channel and the Hallmark Movie Channel.
Privately-held Hallmark is Crown Media's 90% shareholder.
CUMULUS MEDIA: Incurs $32.7 Million Net Loss in 2012
----------------------------------------------------
Cumulus Media Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$32.72 million on $1.07 billion of net revenues for the year ended
Dec. 31, 2012, as compared with net income of $63.86 million on
$519.96 million of of net revenues during the prior year.
For the three months ended Dec. 31, 2012, the Company incurred a
net loss of $84.79 million on $284.19 million of net revenues, as
compared with a net loss of $13.13 million on $281.26 million of
net revenues for the same period a year ago.
The Company's balance sheet at Dec. 31, 2012, showed $3.74 billion
in total assets, $3.42 billion in total liabilities, $71.86
million in total redeemable preferred stock, and $246.63 million
in total stockholders' equity.
Bankruptcy Warning
"The lenders under the 2011 Credit Facilities have taken security
interests in substantially all of our consolidated assets, and we
have pledged the stock of certain of our subsidiaries to secure
the debt under the 2011 Credit Facilities. If the lenders
accelerate the required repayment of borrowings, we may be forced
to liquidate certain assets to repay all or part of such
borrowings, and we cannot assure you that sufficient assets will
remain after we have paid all of the borrowings under such 2011
Credit Facilities. If we were unable to repay those amounts, the
lenders could proceed against the collateral granted to them to
secure that indebtedness and we could be forced into bankruptcy or
liquidation. Our ability to liquidate assets could also be
affected by the regulatory restrictions associated with radio
stations, including FCC licensing, which may make the market for
these assets less liquid and increase the chances that these
assets would be liquidated at a significant loss. Any requirement
for us to liquidate assets would likely have a material adverse
effect on our business."
A copy of the Form 10-K is available for free at:
http://is.gd/aLvJV4
About Cumulus Media
Founded in 1998, Atlanta, Georgia-based Cumulus Media Inc.
(NASDAQ: CMLS) -- http://www.cumulus.com/-- is the second largest
operator of radio stations, currently serving 110 metro markets
with more than 525 stations. In the third quarter of 2011,
Cumulus Media purchased Citadel Broadcasting, adding more than 200
stations and increasing its reach in 7 of the Top 10 US metros.
Cumulus also acquired the Citadel/ABC Radio Network, which serves
4,000+ radio stations and 121 million listeners, in the
transaction
Cumulus Media put AR Broadcasting Holdings Inc. and three other
units to Chapter 11 protection (Bankr. D. Del. Lead Case No.
11-13674) in 2011 after struggling to pay off debts that topped
$97 million as of June 30, 2011. Holdings estimated debts between
$50 million and $100 million but said assets are worth less than
$50 million. AR Broadcasting operated radio stations in Missouri
and Texas.
* * *
Standard & Poor's Ratings Services in October 2011 affirmed is 'B'
corporate credit rating on Cumulus Media.
"The ratings reflect continued economic weakness and higher post-
acquisition leverage than we initially expected," said Standard &
Poor's credit analyst Jeanne Shoesmith. "They also reflect the
combined company's sizable presence in both large and midsize
markets throughout the U.S."
As reported by the TCR on Nov. 20, 2012, Moody's Investors Service
affirmed the B1 Corporate Family Rating of Cumulus Media. The
company's B1 corporate family rating is forward looking and
reflects Moody's expectation that management will continue to
reduce debt balances with free cash flow resulting in net debt-to-
EBITDA ratios of less than 6.0x (including Moody's standard
adjustments, and treating preferred shares as 75% debt) over the
rating horizon, with further improvement thereafter consistent
with management's 4.0x reported leverage target.
CPI CORP: BofA Extends Forbearance Agreement Until April 6
----------------------------------------------------------
CPI Corp., and its subsidiaries that are guarantors under the
Guarantee and Collateral Agreement dated as of Aug. 30, 2010,
entered into the Fourth Forbearance Agreement dated March 8, 2013,
with Bank of America, N.A., as administrative agent, for the
various financial institution parties in the Credit Agreement.
Under the Forbearance Agreement, the Agent, on behalf of itself
and for the benefit of each Lender, agrees to forebear from
exercising its rights and remedies under the Credit Agreement
through April 6, 2013. The Forbearance Agreement did not amend
nor increase the amount of the revolving commitment, nor did it
cure or waive the existing defaults. Upon termination of the
forbearance period for any reason, the Agent is able to exercise
all rights and remedies granted to it under the Credit Agreement,
as amended.
Pursuant to the Credit Agreement, as of March 13, 2013, the
Company owes amounts totaling $98.5 million, which consists of
unpaid principal of $76.1 million, accrued and unpaid interest of
$96,000, accrued and unpaid PIK Obligations of $8.4 million,
letter of credit fees of $151,000 and Letters of Credit totaling
$13.8 million.
Amendment One to Third Forbearance Agreement identified certain
Events of Default that existed under the Loan Documents as of the
date of the Amendment. As of the date of the Forbearance
Agreement, the Existing Defaults are continuing and have not been
cured and the "Forbearance Period" has expired.
The Forbearance Agreement also amended the termination date of the
Credit Agreement to the earlier of April 6, 2013, or the
termination date of the Forbearance Agreement.
The Credit Agreement is amended to require prepayments of the
Revolving Loans on the Forbearance Agreement Effective Date in the
amount of $50,000; on or before March 11, 2013, in the amount of
$100,000; on or before March 22, 2013, in the amount of $150,000;
and on or before April 3, 2013, in the amount of $100,000. Also,
additional covenants require a Cash Flow Budget, Cash Flow
Variance Report, and executed documents necessary to allow the
Administrative Agent to receive, endorse, and collect all U.S.
federal income tax refunds payable to the Loan Parties.
A copy of the Fourth Forbearance Amendment is available at:
http://is.gd/Z4LPyp
About CPI Corp.
Headquartered in St. Louis, Missouri, CPI Corp. provides portrait
photography services at more than 2,500 locations in the United
States, Canada, Mexico and Puerto Rico and provides on location
wedding photography and videography services through an extensive
network of contract photographers and videographers.
The Company reported a net loss of $39.9 million on
$123.2 million of net sales for the 24 weeks ended July 21, 2012,
compared with a net loss of $5.6 million on $159.5 million of net
sales for the 24 weeks ended July 23, 2011.
The Company's balance sheet at July 21, 2012, showed $61 million
in total assets, $159.6 million in total liabilities, and a
stockholders' deficit of $98.6 million.
CUI GLOBAL: Copies of Line of Credit Docs. with Wells Fargo
-----------------------------------------------------------
CUI Global, Inc., filed with the U.S. Securities and Exchange
Commission copies these documents:
* April 3, 2012, line of credit document with the Business
Credit division of Wells Fargo Capital Finance, Sixth
Amendment to the Credit and Security Agreement.
http://is.gd/GL8bbw
* Dec. 7, 2012, line of credit document with the Business
Credit division of Wells Fargo Capital Finance, Seventh
Amendment to the Credit and Security Agreement.
http://is.gd/Qnt71r
About CUI Global
Tualatin, Ore.-based CUI Global, Inc., formerly known as Waytronx,
Inc., is a platform company dedicated to maximizing shareholder
value through the acquisition, development and commercialization
of new, innovative technologies.
CUI Global reported a net loss allocable to common stockholders of
$48,763 in 2011, compared with a net loss allocable to common
stockholders of $7.01 million in 2010.
As reported by the TCR on April 8, 2011, Webb & Company, in
Boynton Beach, Florida, expressed substantial doubt about CUI
Global's ability to continue as a going concern. The independent
auditors noted that the Company has a net loss of $7,015,896, a
working capital deficiency of $675,936 and an accumulated deficit
of $73,596,738 at Dec. 31, 2010. Webb & Company did not include a
"going cocern qualification" in its report on the Company's 2011
financial results.
The Company's balance sheet at Sept. 30, 2012, showed
$36.61 million in total assets, $11.79 million in total
liabilities and $24.82 million in total stockholders' equity.
DEWEY & LEBOEUF: Ch. 11 Liquidation Plan Takes Effect
-----------------------------------------------------
Scott E. Ratner, Esq., at Togut, Segal & Segal LLP, cousnel for
Dewey & LeBoeuf LLP, informs the U.S. Bankruptcy Court for the
Southern District of New York that the Effective Date of the
Debtor's Second Amended Chapter 11 Plan of Liquidation dated Jan.
7, 2013, as modified, occurred on March 22, 2013.
As a result of the occurrence of the Effective Date, the
Liquidation Trust and Secured Lender Trust were established for
the purposes set forth in the Plan, the Liquidating Trust
Agreement and the Secured Lender Trust Agreement, as applicable.
The Debtor submitted Friday to the Bankruptcy Court Friday the
Final Plan Supplement Documents, which include:
(a) confirmation budget;
(b) executed Liquidation Trust Agreement;
(c) executed Secured Lender Trust Agreement;
(d) list containing the identities of the members of the
Liquidation Trust Oversight Committee;
(e) list containing the identity of the member of the Secured
Lender Trust Oversight Committee;
(f) the form of promissory note for Excess Priority Claims and
Excess Priority and Excess Administrative Claims (attached
as Exhibit G to the Liquidation Trust Agreement); and
(g) list of executory contracts and unexpired leases to be
assumed and assigned.
A copy of the Final Plan Supplement Documents is available at:
http://bankrupt.com/misc/dewey&leboeuf.doc1307.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 filed a Chapter 11 Plan of Liquidation and an accompanying
Disclosure Statement on Nov. 21, 2012. It filed amended plan
documents on Dec. 31, in an attempt to address objections lodged
by various parties. A second iteration was filed Jan. 7, 2013.
The plan is based on a proposed settlement between secured lenders
and Dewey's official unsecured creditors' committee, as well as a
settlement with former partners.
On Feb. 27, 2013, the Bankruptcy Court confirmed Dewey & Leboeuf's
Second Amended Chapter 11 Plan of Liquidation dated Jan. 7, 2013,
As of the Effective Date of the Plan, the Debtor will be
dissolved.
DEX ONE: Stockholders OK Amended Plan of Merger with SuperMedia
---------------------------------------------------------------
Dex One Corporation held a special meeting of stockholders on
March 13, 2013, at which the Company's stockholders approved and
adopted the Amended and Restated Agreement and Plan of Merger,
dated as of Dec. 5, 2012, by and among Dex One, SuperMedia Inc.,
Newdex, Inc., and Spruce Acquisition Sub, Inc., and approved, on a
non-binding, advisory basis, the compensation that may be paid or
become payable to Dex One's named executive officers that is based
on or otherwise relates to the merger transaction.
About Dex One
Dex One, headquartered in Cary, North Carolina, is a local
business marketing services company that includes print
directories and online voice and mobile search. Revenue was
approximately $1.1 billion for the LTM period ended Sept. 30,
2010.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex
Media East LLC, Dex Media West LLC and Dex Media Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852). They emerged from bankruptcy on Jan. 29,
2010. On the Effective Date and in connection with its emergence
from Chapter 11, RHD was renamed Dex One Corporation.
Dex One reported a net loss of $518.96 million in 2011 compared
with a net loss of $923.59 million for the eleven months ended
Dec. 31, 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$2.86 billion in total assets, $2.77 billion in total liabilities,
and $92.03 million in total shareholders' equity.
* * *
As reported by the Troubled Company Reporter on Jan. 31, 2013,
Standard & Poor's Ratings Services revised its 'CCC' rating
outlook on Dex One Corp. to negative from developing. Existing
ratings on the company, including the 'CCC' corporate rating, were
affirmed.
"The outlook revision to negative reflects our view that the
company has sufficient lender support to effectively pursue a
prepackaged reorganization," said Standard & Poor's credit analyst
Chris Valentine.
"It also reflects our expectation, given the large lender group
and the diversity of lender interests, that the company may not
get support from all of its lenders to amend its credit agreement
out-of-court. If Dex One files for bankruptcy, we would lower our
corporate credit rating to 'D' and reassess the corporate credit
rating, business risk, and financial risk of the combined company
after emergence," S&P added.
"Our 'CCC' corporate credit rating reflects Standard & Poor's
Ratings Services' view of the company's strong motivation to use
the bankruptcy court to complete its proposed merger with
SuperMedia, and our assessment of its business risk profile as
"vulnerable" and financial risk profile as "highly leveraged."
Furthermore, the rating reflects continued structural and cyclical
decline in the print directory sector, increased competition from
online and other distribution channels as small business
advertising expands across a greater number of marketing channels,
and the potential for additional subpar debt repurchases. Our
management and governance assessment is fair," S&P noted.
The negative rating outlook reflects S&P's expectation that Dex
One may pursue a voluntary prepackaged bankruptcy reorganization
plan to consummate the merger agreement with SuperMedia. S&P
could also lower its rating if declining business fundamentals
hinder 2014 debt refinancing or if S&P becomes convinced the
company could violate financial covenants as a result of a faster-
than-expected decline in EBITDA.
DUMA ENERGY: Delays Form 10-Q for Jan. 31 Quarter
-------------------------------------------------
Management of Duma Energy Corp. was unable to obtain certain of
the business information necessary to complete the preparation of
Duma Energy's Form 10-Q for the quarter ended Jan. 31, 2013, and
the review of the report by the Company's auditors in time for
filing. That information is required in order to prepare a
complete filing.
As a result of this delay the Company was unable to file its
quarterly report on Form 10-Q within the prescribed time period
without unreasonable effort or expense. The Company expects to
file within the extension period.
About Duma Energy
Corpus Christi, Tex.-based Duma Energy Corp. --
http://www.duma.com/-- formerly Strategic American Oil
Corporation, is a growth stage oil and natural gas exploration and
production company with operations in Texas, Louisiana, and
Illinois. The Company's team of geologists, engineers, and
executives leverage 3D seismic data and other proven exploration
and production technologies to locate and produce oil and natural
gas in new and underexplored areas.
Duma Energy incurred a net loss of $4.57 million for the year
ended July 31, 2012, compared with a net loss of $10.28 million
during the prior fiscal year.
The Company's balance sheet at Oct. 31, 2012, showed $27.69
million in total assets, $16.64 million in total liabilities and
$11.04 million in total stockholders' equity.
EAST END: Gets Final OK to Obtain $7.3MM Postpetition Loan
----------------------------------------------------------
The Hon. Robert E. Grossman of the U.S. Bankruptcy Court for the
Eastern District of New York, in a final order, authorized East
End Development, LLC to:
-- obtain postpetition financing from Amalgamated Bank, as
Trustee of Longview Ultra Construction Loan Investment Fund,
formerly known as Longview Ultra I Construction Loan
Investment Fund in the form of a priming, superpriority,
non-amortizing revolving credit facility in the amount of up
to $7,300,000;
-- use cash collateral; and
-- grant adequate protection to the lender.
The Debtor would use the funds to continue operations and to
administer and preserve the value of its Bankruptcy estate. The
Debtor was unable to obtain adequate unsecured credit on more
favorable terms and conditions than what the DIP lender offered.
As adequate protection from any diminution value of the lender's
collateral, the Debtor will grant the DIP lender replacement liens
on assets and property, real and personal, of the Debtor, and
superpriority administrative expense claim, subject to carve out
on certain expenses.
About East End Development
East End Development, LLC, the owner of a 90% completed
condominium in Sag Harbor, New York, filed a Chapter 11 petition
(Bankr. E.D.N.Y. Case No. 12-76181) in Central Islip, New York, on
Oct. 12, 2012. Klestadt & Winters LLP represents the Debtor in
its restructuring efforts. Edifice Real Estate Partners, LLC
serves as its construction consultant. The Debtor disclosed
$27,300,207 in assets and $35,344,416 in liabilities in its
schedules.
EASTMAN KODAK: Shutterfly Sues Over Photo Book App
--------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that photo-sharing
website Shutterfly Inc. on Friday filed suit in New York
bankruptcy court claiming Eastman Kodak Co.'s new mobile photo
book app violates an agreement not to launch a service similar to
the one it sold Shutterfly for $23.8 million last year.
The report related that Shutterfly targets the "My Kodak Moments
App," which allows users to create photo books with images stored
on their Facebook accounts and then purchase those albums. The
app, it argues, uses the same technology and offers the same
service as the "Kodak Gallery" Web.
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies with
strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak has been working to transform itself from a
business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped Milbank,
Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
The Retirees Committee has hired Haskell Slaughter Young &
Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC,
as Bankruptcy Consultants and Financial Advisors; and the Segal
Company, as Actuarial Advisors.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
Kodak completed the $527 million sale of digital-imaging
technology on Feb. 1, 2013. Kodak intends to reorganize by
focusing on the commercial printing business.
EDISON MISSION: Incurs $909 Million Net Loss in 2012
----------------------------------------------------
Edision Mission Energy filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$909 million on $1.28 billion of operating revenues for the year
ended Dec. 31, 2012, as compared with a net loss of $1.07 billion
on $1.63 billion of operating revenues during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed $7.52 billion
in total assets, $6.78 billion in total liabilities and $732
million in total equity.
A copy of the Form 10-K is available for free at:
http://is.gd/6RyONq
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.
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. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EDISON MISSION: Has Final Approval for Employee Incentive Plan
--------------------------------------------------------------
Judge Jacqueline Cox has approved, on a final basis, Edison
Mission Energy's motion to compensate insider senior executives
under employee incentive programs. The Debtors are also
authorized to implement incentive plans for non-insider employees.
The Debtors are authorized to take all actions necessary to
compensate the Senior Executives under the incentive plan;
provided, however, that the "stretch" levels of performance with
regard to 2013 adjusted EBITDAR under the plan shall be (a) $33.8
million for the first six-month performance period and (b) $223.2
million for the second six-month performance period, subject in
all respects to the terms and conditions set forth in the STIP.
Patrick Fitzgerald, writing for Dow Jones Newswires' Daily
Bankruptcy Review, reports that the incentive payments are based
50-50 on cost savings and reliability of the plants. The top
payout could be $22 million. The executives will be eligible for
additional bonuses based on the enterprise value of the
reorganized company.
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.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
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. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EDISON MISSION: Court Extends PoJo Forbearance Agreement
--------------------------------------------------------
Judge Jacqueline P. Cox of the Bankruptcy Court for the Northern
District of Illinois has authorized Edison Mission Energy to
perform obligations under an amended forbearance agreement dated
as of March 1, 2013, with respect to the leveraged leases of the
Powerton Generating Station in Pekin, Ill., and Units 7 and 8 of
the Joliet Generating Station in Joliet, Ill. (PoJo Facilities).
Under the amendment, the forbearance agreement will expire on
April 5, 2013.
As reported in the Troubled Company Reporter on Dec. 26, 2012,
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).
Pursuant to the Original Forbearance Order, on Feb. 15, 2013, MWG
made a payment of approximately $7.1 million of the approximately
$75 million in Basic Lease Rent that became due and owing on
January 2, 2013, under the Lease. Approximately two weeks before
the expiration of the original 60-day forbearance period provided
under the Original Forbearance Order, the PoJo Debtors, the
Certificate Holders, the Equity Investors, and the Owner Trusts
began discussing a possible extension to the Original Forbearance
Agreement to continue discussions and facilitate further diligence
regarding MWG's financial condition. On March 1, 2013, the
parties entered into the Amended Forbearance Agreement, which,
among other things, extends the initial 60-day forbearance period
until April 5, 2013.
The Amended Forbearance Agreement is on substantially similar
terms as the Original Forbearance Agreement; provided, however,
that the Amended Forbearance Agreement extends the Forbearance
Period and facilitates the reasonable exchange of due diligence
among the parties as set forth in greater detail in the Amended
Forbearance Agreement. The Debtors believe that entering into and
performing under the Amended Forbearance Agreement is a critical
component of their restructuring efforts because it affords the
PoJo Debtors, Certificate Holders, Owner Trusts, and other
stakeholders further time to review, perform due diligence, and
analyze restructuring options related to the PoJo Facilities
without the threat of imminent litigation.
The possibility of a default under the Lease Indentures could
impair the Debtors' ability to maintain stability of their
operations while simultaneously maintaining their flexibility to
consider all potential options associated with the PoJo
Facilities. The Amended Forbearance Agreement ensures that the
status quo at the PoJo Facilities will continue, thereby allowing
ongoing diligence and analysis to continue without the overhang of
potential litigation. By avoiding the cost and distraction
inherent in such potential litigation, while at the same time
continuing the opportunity for a review and dialogue regarding the
PoJo Facilities, the Debtors further ensure value preservation for
the benefit of all parties in interest.
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.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
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. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EDISON MISSION: Deadline to Remove Actions Extended to Sept. 13
---------------------------------------------------------------
U.S. Bankruptcy Judge Jacqueline P. Cox has extend the deadline
for Edison Mission Energy to remove actions under Bankruptcy Rule
9027 to the later of (x) September 13, 2013; (y) the day that is
30 days after entry of an order terminating the automatic stay
with respect to the particular action sought to be removed; or (z)
with respect to actions commenced after the bankruptcy filing, the
time periods set forth in Bankruptcy Rule 9027(a)(3).
Edison Mission Energy said the Debtors are currently involved in
more than 50 civil actions pending in various forums. In
addition, additional civil actions may be commenced against
certain of the Debtors during the pendency of these chapter 11
cases. The statutory period within which the Debtors may file
notices to remove any of the Prepetition Actions is scheduled to
expire on March 17, 2013.
The Debtors and their advisors have only recently begun the
process of analyzing the Actions to determine whether the Debtors
will seek to remove any Actions to this Court. While section
362(a) of the Bankruptcy Code automatically stays many of the
Actions pending against the Debtors, the Debtors are not yet
prepared to decide which, if any, of the Actions they will seek to
remove. Accordingly, the Debtors will not have the time necessary
to properly evaluate the removal of the Actions, thereby forcing
the Debtors to make quick decisions that could ultimately prove to
be detrimental to the Debtors' estates.
The time within which the Debtors must file notices to remove the
Prepetition Actions is set to expire on March 17, 2013. The
Debtors' decision regarding whether to seek removal of any
particular Action depends on a number of factors. To make the
appropriate determination, the Debtors must analyze each Action
following full consideration of several factors.
At this stage of these chapter 11 cases, the Debtors have not had
a full opportunity to determine conclusively which Actions they
will seek to remove. To date, the Debtors have been focused on
stabilizing their business and conducting their investigation of
the restructuring transactions contemplated under the TSA. The
Debtors have been addressing matters critical to their ability to
continue business as usual, resulting in the need for additional
time to analyze the Actions and make the appropriate
determinations concerning their removal to this Court.
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.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
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. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EDISON MISSION: Stay Lifted to Permit Labor Union Arbitration
-------------------------------------------------------------
The Bankruptcy Court has lifted the automatic stay to allow Edison
Mission Energy and its affiliates and the International
Brotherhood of Electric Workers Local 15 (IBEW Local 15) to
continue current arbitration and grievance proceedings.
The Debtors are authorized to allow any new arbitration and
grievance proceedings to proceed in accordance with the CBA,
provided that the order will not authorize the Debtors to pay any
awards or settlements related to any current or future arbitration
or grievance proceedings incurred pursuant to the CBA, regardless
of whether such awards or settlements arose before or after the
Petition Date. All parties' rights are reserved with respect to
the payment of any awards and settlements.
As reported in the Troubled Company Reporter on March 7, 2013, at
least 750 of Debtor Midwest Generation LLC's hourly employees are
members of the IBEW Local 15 and are employed pursuant to the
collective bargaining agreement between Midwest Gen and IBEW Local
15. The CBA provides a streamlined and efficient process for
resolving disputes between IBEW Local 15 and Midwest Gen. The CBA
also includes arbitration provisions if the parties cannot resolve
the grievance consensually. The CBA outlines the arbitration
process, including deadlines, the individuals identified as
proposed arbitrators, the procedures for choosing future
arbitrators, and cost allocation and sharing procedures.
Midwest Gen and IBEW Local 15 were arbitrating one grievance that
an IBEW Local 15 member had commenced prior to the Petition Date,
Arb. No. 11-164 pending before arbitrator Steven Bierig. At issue
in the Arbitration Proceeding is whether Midwest Gen is compelled
to pay new hires at certain wage levels delineated in the CBA, or
whether Midwest Gen may pay new hires based on that employee's
level of experience. The parties were unable to resolve the
dispute through the grievance procedures in the CBA and the matter
proceeded to arbitration in October 2011. Arbitration and
evidentiary hearings were held in April 2012. Following the
arbitration hearing, both parties submitted post-hearing briefs
and are awaiting a decision from Mr. Bierig.
On Dec. 20, 2012, Midwest Gen sent a letter to Mr. Bierig,
notifying him that Midwest Gen had filed for bankruptcy, and
informing him that the Arbitration Proceeding was stayed pursuant
to section 362 of the Bankruptcy Code. Since that time, IBEW
Local 15 approached Midwest Gen and requested that the Arbitration
Proceeding be allowed to continue due to the advanced state of the
proceedings. On Feb. 4, 2013, Midwest Gen sent a follow-up letter
to Mr. Bierig indicating they intended to seek relief from the
automatic stay so as to allow the Arbitration Proceeding to
proceed.
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.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
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. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
ELBIT VISION: Incurs $179,000 Loss in Fourth Quarter
----------------------------------------------------
Elbit Vision Systems Ltd. reported a loss of US$179,000 on US$1.36
million of revenue for the three months ended Dec. 31, 2012, as
compared with income of US$230,000 on US$1.41 million of revenue
for the same period during the prior year.
For the 12 months ended Dec. 31, 2012, the Company reported income
of US$824,000 on US$6.70 million of revenue, as compared with
income of US$1.08 million on US$5.64 million of revenue a year
ago.
The Company's balance sheet at Dec. 31, 2012, showed US$4.20
million in total assets, US$4.48 million in total liabilities and
a US$274,000 shareholders' deficiency.
Sam Cohen, CEO of EVS commented, "We are continuing to grow our
business in line with our plans and in 2012 increased our revenues
by an additional 19% over 2011. Our net profits for the year
decreased mainly due to material investments we made on expanding
our local infrastructure in China and India."
"We are working on new products which we intend launching during
2013. These products will expand our portfolio to current and new
customers, and we believe the new offerings will have a
significant positive impact on our business," concluded Mr. Cohen.
A copy of the press release is available for free at:
http://is.gd/7BuVWJ
About Elbit Vision
Based in Caesarea, Israel, Elbit Vision Systems Ltd. (OTC BB:
EVSNF.OB) offers a broad portfolio of automatic State-of-the-Art
Visual Inspection Systems for both in-line and off-line
applications, and process monitoring systems used to improve
product quality, safety, and increase production efficiency.
ELEPHANT TALK: Delays Form 10-K for 2012
----------------------------------------
Elephant Talk Communications Corp. was unable to file its annual
report on Form 10-K for the fiscal year ended Dec. 31, 2012, on a
timely basis because the Company required additional time to work
with its outside professionals to prepare and finalize the
document. The Company fully expects to file its Form 10-K within
the additional time allowed by this report.
About Elephant Talk
Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK)
-- http://www.elephanttalk.com/-- is an international provider of
business software and services to the telecommunications and
financial services industry.
Elephant Talk reported a net loss of $25.31 million in 2011, a net
loss of $92.48 million in 2010, and a net loss of $17.29 million
in 2009. The Company's balance sheet at Sept. 30, 2012, showed
$42.56 million in total assets, $18.18 million in total
liabilities and $24.37 million in total stockholders' equity.
ENERGYSOLUTIONS INC: Reports $3.9 Million Net Income in 2012
------------------------------------------------------------
EnergySolutions, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing net income of
$3.92 million on $1.80 billion of revenue for the year ended
Dec. 31, 2012, as compared with a net loss of $193.64 million on
$1.81 billion of revenue during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed $2.65 billion
in total assets, $2.35 billion in total liabilities and
$300.91 million in total stockholders' equity.
Bankruptcy Warning
"Our senior secured credit facility contains financial covenants
requiring us to maintain specified maximum leverage and minimum
cash interest coverage ratios. The results of our future
operations may not allow us to meet these covenants, or may
require that we take action to reduce our debt or to act in a
manner contrary to our business objectives.
"Our failure to comply with obligations under our senior secured
credit facility, including satisfaction of the financial ratios,
would result in an event of default under the facilities. A
default, if not cured or waived, would prohibit us from obtaining
further loans under our senior secured credit facility and permit
the lenders thereunder to accelerate payment of their loans and
not renew the letters of credit which support our bonding
obligations. If we are not current in our bonding obligations, we
may be in breach of our contracts with our customers, which
generally require bonding. In addition, we would be unable to bid
or be awarded new contracts that required bonding. If our debt is
accelerated, we currently would not have funds available to pay
the accelerated debt and may not have the ability to refinance the
accelerated debt on terms favorable to us or at all particularly
in light of the tightening of lending standards as a result of the
ongoing financial crisis. If we could not repay or refinance the
accelerated debt, we would be insolvent and could seek to file for
bankruptcy protection. Any such default, acceleration or
insolvency would likely have a material adverse effect on the
market value of our common stock."
A copy of the Form 10-K is available for free at:
http://is.gd/0REWZb
About EnergySolutions
Salt Lake City, Utah-based EnergySolutions offers customers a full
range of integrated services and solutions, including nuclear
operations, characterization, decommissioning, decontamination,
site closure, transportation, nuclear materials management, the
safe, secure disposition of nuclear waste, and research and
engineering services across the fuel cycle.
* * *
As reported in the Jan. 9, 2013 edition of the TCR, Standard &
Poor's Ratings Services placed its ratings, including its 'B'
corporate credit rating, on EnergySolutions on CreditWatch with
developing implications.
"The CreditWatch placement follows EnergySolutions' announcement
that it has entered into a definitive agreement to be acquired by
a subsidiary of Energy Capital Partners II," said Standard &
Poor's credit analyst Jim Siahaan.
EnergySolutions is permitted to engage in discussions with other
suitors, which may include other financial sponsors or strategic
buyers.
ENDEAVOUR INTERNATIONAL: Incurs $126 Million Net Loss in 2012
-------------------------------------------------------------
Endeavour International Corporation filed with the U.S. Securities
and Exchange Commission its annual report on Form 10-K disclosing
a net loss of $126.22 million on $219.05 million of revenue for
the year ended Dec. 31, 2012, as compared with a net loss of
$130.99 million on $60.09 million of revenue during the prior
year.
The Company's balance sheet at Dec. 31, 2012, showed $1.44 billion
in total assets, $1.29 billion in total liabilities,
$43.70 million in Series C convertible preferred stock, and
$99.43 million in total stockholders' equity.
A copy of the Form 10-K is available for free at:
http://is.gd/9CxSZQ
About Endeavour International
Houston-based Endeavour International Corporation (NYSE: END)
(LSE: ENDV) is an oil and gas exploration and production company
focused on the acquisition, exploration and development of energy
reserves in the North Sea and the United States.
* * *
As reported by the TCR on March 5, 2013, Moody's Investors Service
downgraded Endeavour International Corporation's Corporate Family
Rating to Caa3 from Caa1. Endeavour's Caa3 CFR reflects its weak
liquidity, small production and proved reserve scale, geographic
concentration and the uncertainties regarding its future
performance given the inherent execution risks related to its
offshore North Sea operations for a company of its size.
In the Feb. 22, 2013, edition of the TCR, Standard & Poor's
Ratings Services lowered its corporate credit rating on Houston,
Texas-based Endeavour International Corp. (Endeavour) to 'CCC+'
from 'B-'. The rating action reflects S&P's expectation that
Endeavour could have insufficient liquidity to meet its needs due
to the delay in production from its Rochelle development.
ENERGY FUTURE: Aurelius Sues Officers and Directors
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Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that officers and directors of Energy Future Holdings
Corp. were sued by Aurelius Capital Management LP, based on
allegations the insolvent holding company parent caused solvent
subsidiary Texas Competitive Holdings Co. to make billions in
loans to the parent at interest rates not available in the market.
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.
ENERGY TRANSFER: Moody's Affirms 'Ba2' CFR; Outlook Stable
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Moody's Investors Service affirmed Energy Transfer Partners,
L.P.'s Baa3 rating with a stable outlook. Moody's also affirmed
Energy Transfer Equity, L.P.'s Ba2 Corporate Family Rating
Rationale: and its Ba2 senior secured debt rating with a stable
outlook.
These actions are in response to ETP's announcement that it will
acquire ETE's 60% interest in the jointly owned intermediate
holding company, ETP Holdco Corporation in a $3.75 billion
intercompany cash and units transaction. Holdco is the vehicle
through which ETP controls Southern Union Company (SUG, Baa3
stable) and Sunoco, Inc. (SUN, Baa3 stable).
Issuer: Energy Transfer Partners, L.P.
Affirmations:
Senior Unsecured Debt -- Affirmed Baa3
Senior Unsecured Shelf -- Affirmed (P) Baa3
Issuer: Energy Transfer Equity, L.P.
Affirmations:
Corporate Family Rating -- Affirmed Ba2
Probability of Default Rating -- Affirmed Ba2-PD
Senior Secured Debt -- Affirmed Ba2 (LGD4-50%)
Senior Secured Bank Facility -- Affirmed Ba2 (LGD4-50%)
Speculative Grade Liquidity Rating -- SGL3
Ratings Rationale:
"Consolidating its ownership of Holdco through this transaction
represents a desirable simplification of ETP's organizational
structure, while providing funding for debt reduction at ETE,"
commented Andrew Brooks, Moody's Vice President. "While ETP's
leverage will temporarily increase as a result of funding the cash
portion of this transaction with debt, there are readily
identified sources of cash available to ETP to rapidly restore
leverage to pre-transaction levels, while overall ETE consolidated
debt leverage remains essentially unchanged."
Following ETP's October 2012 acquisition of SUN, Holdco was
established into which ETE contributed its ownership of SUG and
ETP contributed SUN. ETP and ETE share ownership in Holdco on a
40% and 60% basis, respectively, with ETP holding a controlling
interest. SUG is both a holding company of pipeline and natural
gas midstream assets as well as gas utility divisions in Missouri
and Massachusetts. SUN's principal remaining assets consist of its
network of 4,900 retail service stations, having previously
contributed its general and limited partnership interests in
Sunoco Logistics Partners, L.P. (SXL guarantees the debt of Sunoco
Logistics Partners Operations, L.P., Baa3 stable) to ETP.
To fund the acquisition of ETE's 60% stake in Holdco, ETP will
issue $2.35 billion in ETP units to ETE, increasing ETE's limited
partnership (LP) interest in ETP to approximately 28%. The
remaining $1.4 billion cash consideration will be funded with $600
million of cash proceeds from the pending sale by SUG of its
natural gas gathering and processing business -- Southern Union
Gas Services (SUGS) -- to Regency Energy Partners, LP (RGP, Ba3
positive) in a transaction which ETP expects to close in May 2013.
The balance of the cash portion, approximately $800 million, will
be funded under ETP's revolving credit facility. Moody's expects
the proceeds of SUG's pending sale of its two gas utilities, which
it has agreed to sell to The Laclede Group, Inc. (LG, (P)Baa2
negative) in a $1.035 billion transaction expected to close by
year-end, will be used to reduce ETP's revolver borrowings and to
repay debt at SUG. While ETP's debt leverage will temporarily
increase as a result of revolving credit borrowings, Moody's
expects debt/EBITDA to be restored to the pre-transaction levels
it approximates at 4.8x. Moody's expects ETE to use the $1.4
billion cash proceeds of the sale to prepay a significant portion
of its $2.0 billion secured term loan.
ETP maintains a $2.5 billion unsecured revolving credit facility,
which is scheduled to mature in October 2016. At December 31, $1.4
billion was outstanding under the revolver, however, the proceeds
of a $1.25 billion January notes issue repaid the bulk of these
outstandings, leaving ample liquidity for the interim funding the
cash portion of the Holdco transaction, as well as ongoing growth
capital spending.
ETP remains aggressively leveraged, approaching 4.8x debt/EBITDA,
and is burdened by the continued complexity of its organizational
structure, which the Holdco transaction begins to address. As a
master limited partnership (MLP), ETP is wholly dependent on
external sources of financing to fund its ambitious growth capital
requirements, and it remains under pressure to grow its rate of
cash distribution and to generate distributable cash to ETE, which
has its own debt service and partnership distributions to support.
ETP's stable outlook reflects the extensive scope and quality of
its midstream asset base, its record of equity issuance to support
growth projects and acquisitions, and Moody's expectation of
continuing EBITDA growth. ETP's ratings could be downgraded if it
fails to sustain debt leverage below 4.5x. Additionally, should
ETP embark on another sizable acquisition in the near future, its
Baa3 could be placed in jeopardy, as would increase pressure from
ETE for a higher level of cash distributions. While an upgrade is
considered unlikely, reducing debt leverage to the 4.0x area could
prompt such consideration.
ETE's stable outlook reflects the diversified distribution streams
derived from its subsidiary interests, and the quality of their
respective assets. ETE's ratings could be downgraded should
consolidated leverage on a permanent basis increase over 6x
EBITDA. Furthermore, should cash distributions to ETE be
compromised through higher leverage or weakness in distributable
cash flows at partnership and subsidiary levels, ratings could be
downgraded. A ratings upgrade could be considered to the extent
consolidated is sustained below 5.0x and should the transparency
of ETE's overall organizational structure become more clarified
through additional rationalization of its partnership and
subsidiary holdings.
The principal methodology used in this rating was Global Midstream
Energy 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.
Energy Transfer Partners, L.P. is a midstream MLP headquartered in
Dallas, Texas, whose general partner is Energy Transfer Equity,
L.P., also headquartered in Dallas, Texas.
ENTERTAINMENT PUBLICATIONS: Draws Bid From Founders' Son
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Jamie Santo of BankruptcyLaw360 reported that private equity-owned
Entertainment Publications LLC received a last-minute reprieve
from liquidation Thursday as its Chapter 7 trustee said he had
received an $11 million going-concern offer for the venerable
coupon-book publisher from the son of its original owners.
The report said Trustee Charles M. Forman said HSP-EPI Acquisition
LLC signed an asset purchase agreement to buy Entertainment
Publications and asked for temporary permission to operate the
company while he conducts an expedited stalking-horse auction for
the 50-year-old firm, according to a series of motions filed in
Delaware bankruptcy court.
About Entertainment Publications
Troy-Michigan based Entertainment Publications LLC, a producer of
discount and promotion products, filed for Chapter 7 liquidation
on March 12 in Delaware (Case No. 13-10496).
The company was founded in 1962 by Hughes and Sheila Potiker as
Sports Unlimited, selling 8,000 coupon books in the Detroit area.
The company was acquired in 2008 by an affiliate of MHE Private
Equity Fund LLC, which said at the time that the sale and
accompanying tax benefit to seller IAC/InterActive Corp. was
valued at about $135 million.
The petition described the assets as worth less than $50 million
with debt totaling more than $50 million.
Christopher Ward, Esq., vice chairman of the bankruptcy and
financial restructuring practice group at the Kansas City, Mo.-
based law firm Polsinelli Shughart, represents the company.
In March 2011, the company rebranded itself as Entertainment
Promotions LLC, which has been its d.b.a. since then.
The bankruptcy appears to be fallout between Menard and his
longtime friend and former business partner in MH Equity Partners,
Steve Hilbert. Hilbert was removed from control of the private
equity fund. Menard wanted Hilbert out because MH Private
Equity's investments have lost 70 percent of their value,
according to a lawsuit filed in November 2012 in Wisconsin by
Merchant Capital and Menard Inc. MH Private Equity spent $495
million to buy or invest in eight companies, including
Entertainment Publications. Those investments have lost $344
million of their value since the fund was founded in 2005.
ENVIRONMENTAL SOLUTIONS: Incurs $1.4-Mil. Net Loss in 2012
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Environmental Solutions Worldwide, Inc., filed on March 20, 2013,
its annual report on Form 10-K for the year ended Dec. 31, 2012.
MSCM LLP, in Toronto, Canada, expressed substantial doubt about
Environmental Solutions' ability to continue as a going concern,
citing the Company's experience of negative cash flows from
operations and its dependency upon future financing.
The Company reported a net loss of $1.4 million on $10.5 million
of revenue for 2012, compared with a net loss of $9.1 million on
$11.9 million of revenue for 2011.
During the year ended Dec. 31, 2011, the Company incurred costs
related to various financing and debt transactions that were not
incurred in the year ended Dec. 31, 2012.
The Company's balance sheet at Dec. 31, 2012, showed $5.4 million
in total assets, $2.5 million in total liabilities, and
shareholders' equity of $2.9 million.
A copy of the Form 10-K is available at http://is.gd/JzeaFN
Montgomeryville, Pa.-based Environmental Solutions is a publicly
traded Florida corporation formed in 1987 in the State of Florida.
ESW is focused on the medium duty and heavy duty diesel engine
market for on-road and off-road vehicles as well as the utility
engine, mining, marine, locomotive and military industries. ESW
offers engine and after treatment emissions verification testing
and certification services. ESW's common stock is currently
quoted on the OTC QB, which is part of the OTC Market Group's
quotation system under the symbol (ESWW).
ERF WIRELESS: Names Seasoned CEO/CFO to Board of Directors
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Bruce Lancaster has joined ERF Wireless's Board of Directors as
one of its independent directors. Mr. Lancaster is the former
CEO, CFO and Director of OI Corporation, a Texas-based
manufacturer of analytical instruments. Mr. Lancaster is an
experienced change architect who specializes in implementing
successful turnaround and growth strategies for companies
operating in challenging and competitive markets.
According to Dr. H. Dean Cubley, CEO of ERF Wireless, "Bruce is an
insightful strategist with sound financial credentials, extensive
operational experience and a successful track record of working
with Boards of Directors and executive teams. In addition to his
SOX compliance expertise, Bruce also has excelled in writing SEC
reports during his public company career. In addition to his
Board participation, Bruce also qualifies as a financial expert
and has agreed to serve as the Chairman of our Audit Committee.
He will be an exceptional addition to the ERF Wireless Board of
Directors and we are looking forward to his association with ERF
Wireless Inc."
Mr. Lancaster commented, "I am very pleased to join the ERF
Wireless Board and look forward to working with Dr. Cubley, as
well as ERF's Board and management team."
Mr. Lancaster is a graduate of Texas A&M University, with a BBA,
Accounting Emphasis, and an MBA, Accounting Emphasis. He is also
a licensed CPA in Texas.
Based in League City, Texas, ERF Wireless, Inc., provides secure,
high-capacity wireless products and services to a broad spectrum
of customers in primarily underserved, rural and suburban parts of
the United States.
The Company's balance sheet at Sept. 30, 2012, showed $6.45
million in total assets, $9.40 million in total liabilities and a
$2.94 million total shareholders' deficit.
The Company incurred a consolidated net loss of $3.75 million for
the nine months ended Sept. 30, 2012, as compared with a
consolidated net loss of $2.32 million for the same period a year
ago.
FANNIE MAE: Delays 2012 Annual Report for Further Analysis
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Fannie Mae has determined that it is unable to file its annual
report on Form 10-K for the year ended Dec. 31, 2012, by the
March 18, 2013, filing deadline due to the need for additional
time to analyze whether conditions existed as of Dec. 31, 2012,
that would require Fannie Mae, under generally accepted accounting
principles, to release any portion of the valuation allowance on
its deferred tax assets in the fourth quarter of 2012. The
release of the valuation allowance would have a material impact on
the company's 2012 financial statements and result in a
significant dividend payment to the U.S. Department of the
Treasury under the terms of the Variable Liquidation Preference
Senior Preferred Stock, Series 2008-2.
If the Company concludes the valuation allowance should not be
released in the fourth quarter of 2012, Fannie Mae will continue
to evaluate the need for the valuation allowance in future
periods. The valuation allowance on the Company's deferred tax
assets was $64.1 billion as of Dec. 31, 2011, and $61.5 billion as
of Sept. 30, 2012.
Regardless of the decision to release or not release the valuation
allowance, the Company expects to report significant net income
for the three months and the year ended Dec. 31, 2012, compared
with a net loss of $2.4 billion for the three months ended
Dec. 31, 2011, and a net loss of $16.9 billion for the year ended
Dec. 31, 2011.
About Fannie Mae
Federal National Mortgage Association, aka Fannie Mae, is a
government-sponsored enterprise that was chartered by U.S.
Congress in 1938 to support liquidity, stability and affordability
in the secondary mortgage market, where existing mortgage-related
assets are purchased and sold.
Fannie Mae has been under conservatorship, with the Federal
Housing Finance Agency acting as conservator, since Sept. 6,
2008. As conservator, FHFA succeeded to all rights, titles,
powers and privileges of the company, and of any shareholder,
officer or director of the company with respect to the company and
its assets. The conservator has since delegated specified
authorities to Fannie Mae's Board of Directors and has delegated
to management the authority to conduct day-to-day operations.
The U.S. Department of the Treasury owns Fannie Mae's senior
preferred stock and a warrant to purchase 79.9% of its common
stock, and Treasury has made a commitment under a senior preferred
stock purchase agreement to provide Fannie with funds under
specified conditions to maintain a positive net worth.
Fannie Mae reported a net loss of $16.85 billion in 2011, a net
loss of $14.01 billion in 2010, and a net loss of $72.02 billion
in 2009.
The Company's balance sheet at June 30, 2012, showed
$3.19 trillion in total assets, $3.19 trillion in total
liabilities, and $2.77 billion in total equity.
FIFTH THIRD BANCORP: DBRS Hikes Preferred Stock Rating to 'BB'
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DBRS, Inc. has confirmed all ratings of Fifth Third Bancorp
(Fifth Third or the Company), including its Issuer & Senior Debt
rating of A (low). At the same time, DBRS upgraded Fifth Third's
preferred stock rating to BB (high) from BB, which is consistent
with DBRS's base notching policy. The trend on all ratings
remains Stable.
The rating actions follow a detailed review of the Company's
operating results, financial fundamentals and future prospects.
Fifth Third's ratings consider the Company's solid banking
franchise, which extends through twelve contiguous states from
Michigan to Florida. Positively, with the majority of its lending
and deposit relationships located in the Mid-west, Fifth Third has
benefited from the economic resurgence in the region, driven by
the revival of the automobile industry specifically and
manufacturing in general. Nonetheless, DBRS notes that this
region is highly competitive and heavily banked.
Ratings also reflect the Company's resilient, yet pressured
earnings generation capacity. As with most banks, earnings
continue to be constrained by a slow growing economy and the low
interest rate environment. Nonetheless, DBRS notes that Fifth
Third's core earnings, or adjusted income before provisions and
taxes (IBPT), continue to benefit from elevated levels of mortgage
banking income, sound loan growth, and well managed expenses.
Core earnings also reflect stabilizing credit costs, driven by
sound and improving asset quality.
Further underpinning the Company's ratings are its solid capital
and liquidity positions. Supporting assets is a sound capital
profile, which reflects a high tangible common equity ratio of
9.1% (8.8% excluding unrealized securities gains/losses) and an
estimated Basel III Tier I common ratio of 8.8%, which is
comfortably above the buffered minimum of 7%. Meanwhile, the
Company has a solid core deposit base that fully supports net
loans. DBRS currently views Fifth Third as being well positioned
within its rating category.
Given its deeply entrenched franchise with a well-rooted sales
culture, the Company maintains solid revenue generation capacity.
During 2012, Fifth Third's core earnings reflected sustained
quarterly improvement. Specifically, quarterly IBPT growth was
primarily driven by improved levels of adjusted fee income, mostly
attributable to elevated levels of mortgage banking revenues.
Recently, higher fee income also reflected increased corporate
banking revenue, driven by higher syndication and business lending
fees. Importantly, on a DBRS adjusted basis, Fifth Third's fee
income represented a solid 46% of total revenues (4Q12); providing
stability and diversity to earnings. Nonetheless, DBRS notes that
mortgage banking income will likely decrease going forward, as
levels of re-financings decline and gain-on-sale spreads narrow.
As with most banks, the Company's net interest margin (NIM)
remains pressured by the low interest rate environment, as
decreasing earning asset yields continue to outpace declining
funding costs. Fifth Thirds' 4Q12 NIM of 3.49%, while solid, will
likely contract through 2013. DBRS notes that the Company's NIM
will benefit from the recent retirement of higher cost funding,
including the 4Q12 $1 billion prepayment of FHLB and the 3Q12 $1.4
billion redemption of Trups.
Overall, management anticipates that NIM will narrow modestly in
2013 and range between 3.35% and 3.40%. Positively, loan growth
helped offset margin pressure and led to relatively stable
quarterly levels of spread income during 2012. Loan growth, a key
to earnings growth, was led by higher levels of commercial &
industrial (C&I) loans, residential mortgages and automobile
loans, partially offset by lower levels of commercial real estate
(CRE) exposure, construction loans, and home equity loans.
Despite the challenging business environment, Fifth Third's asset
quality is sound and improved, reflecting lower YoY levels of
non-performing assets (NPAs) and net charge-offs (NCOs). Indeed,
the Company's credit metrics reflected broad-based improvements
across all key loan categories. NPAs of $1.3 billion (including
$29 million of held for sale loans) at YE12, declined $639
million, or 32.7%, from YE11, to a manageable 1.49% (3.71%
including restructured loans) of total loans plus OREO, while NCOs
for 2012 represented a modestly elevated 0.85% of average loans,
down considerably from 1.49% for 2011. On a geographic basis, the
Florida loan portfolio continues to underperform. Although the
state represents only 7% of the Company's total loans, it was
responsible for an outsized 25% of its NPAs (at December 31, 2012)
and 13% of its NCOs for 4Q12.
DBRS considers the Company to be well reserved, as its allowance
for loan losses represented 2.16% of total loans and 144% of NPAs.
Reflecting the Company's healthy coverage of credit costs, Fifth
Third's 4Q12 provisions for loan loss reserves represented a
moderate 11% of its adjusted IBPT. Furthermore, DBRS believes
that Fifth Third's solid capitalization levels should enable it to
absorb additional losses, if necessary.
Despite, stock buybacks, Fifth Third's capital position is solid
and provides for growth, both organically and through acquisition.
DBRS notes that the Company's regulatory capital metrics are
comfortably above "well capitalized" levels as defined by the
regulators. Further reflecting Fifth Third's solid capital
position, its 2013 CCAR results reflected the Company's severely
stressed Tier I common ratio at a 7.5% minimum, which is
comfortably above the regulatory minimum requirement.
Finally, the ratings reflect the strength of the Company's deposit
shares in multiple markets and its position as the leading
depository in the State of Ohio. Fifth Third has substantial
available borrowing capacity at the FHLB and Fed. Furthermore,
the Company has sufficient available liquidity at the holding
company to satisfy its obligations without relying on up-streamed
dividends from its subsidiaries for over 1.3 years (4Q12).
Fifth Third, a diversified financial services corporation
headquartered in Cincinnati, Ohio, reported $122 billion in
consolidated assets as of December 31, 2012.
FLAT OUT: Court Approves March 29 Auction of Flat Top's Assets
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The U.S. Bankruptcy Court for the Southern District of New York
approved the bidding procedures to govern the sale of assets of
Flat Top Grill, an affiliate of Flat Out Crazy, LLC, et al. The
Debtors scheduled a March 29 auction. Competing bids were due
March 20. The Court will consider approval of the sale of the
assets to the winning bidder at an April 8 hearing.
About Flat Out Crazy
Flat Out Crazy LLC and its affiliates operate two Asian-inspired
restaurant chains that began in Chicago. Flat Top Grill, which
currently has 15 locations, is a full-service fast-casual create-
your-own stir-fry concept. Stir Crazy Fresh Asian Grill, which
has 11 locations, is a full-service casual Asian restaurant
offering the flavors of Chinese, Japanese, Thai and Vietnamese
food. The Debtors have 1,200 employees.
Flat Out Crazy and 13 affiliates sought Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 13-22094) in White Plains, New York
on Jan. 25, 2013. The Debtors have tapped Squire Sanders (US) LLP
as counsel; Kurtzman Carson Consultants, LLC, as claims, noticing
and administrative agent; William H. Henrich and Mark Samson from
Getzler Henrich as their co-chief restructuring officers; and J.H.
Chapman Group, L.L.C, as their investment bankers.
The Debtors disclosed total assets of $28.0 million and
liabilities of $37.5 million as of Nov. 28, 2012.
An official committee of unsecured creditors has been appointed in
the Debtors' cases.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed Alan
Chapell, as the consumer privacy ombudsman in the Debtors' cases.
FR 160: Court OKs Expansion of Snell & Wilmer Employment
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FR 160, LLC, won approval from the bankruptcy court to expand the
scope of employment of its counsel Snell & Wilmer L.L.P. to
include representing the Debtor in certain causes of action.
The Debtor holds certain causes of action. In addition to the
Debtor, IMH Special Asset NT 101, LLC, also owns property in the
Flagstaff Ranch Golf Club Community and holds many of the same
causes of action as the Debtor. Additionally, IMH Special Asset
NT 118, LLC, and IMH Special Asset NT 132, LLC, may hold causes of
action against some of the same entities as the Debtor. All of
these entities have been sued in Coconino County Superior Court
(Case No. CV2012-00757) by Masters FRGC Estates Partners, LLC,
Victor and Julia McCleve, Tract M, LLC and Vincent Goett and
may have state and/or federal claims against those entities.
IMH Financial Corporation is the managing member of IMH NT 101,
IMH NT 118 and IMH NT 132. IMHFC is also the managing member of
the Debtor. IMH NT 101, IMH NT 118 and IMH NT 132 are not
creditors in the bankruptcy estate nor do they hold any interest
in the Debtor.
In addition, the Court expanded the scope of Snell & Wilmer's
representation to include IMH NT 101, IMH NT 118, and IMH NT 132
as joint parties with the Debtor in the Debtor Causes of Action.
IMHFC, IMH NT 101, IMH NT 118, and/or IMH NT 132 have agreed to
pay all of the legal fees and costs incurred by Snell & Wilmer
associated with the Debtor Causes of Action, and IMHFC, IMH NT
101, IMH NT 118, and IMH NT 132 will not be seeking any
reimbursement from the bankruptcy estate for these fees and costs.
As reported in the Troubled Company Reporter on July 18, 2012,
Snell & Wilmer L.L.P. as counsel to the Debtor agreed to provide
various services, including:
(a) rendering legal advice with respect to the powers and
duties of the Debtor that will continue to manage its
property and assets as debtor-in-possession;
(b) negotiating and preparing on the Debtor's behalf a plan of
reorganization, disclosure statement, and all related
agreements and/or documents and take any necessary action on
behalf of the Debtor to obtain confirmation of such plan;
and
(c) taking all necessary action to protect and preserve the
estate of the Debtor, including the prosecution of actions
on the Debtor's behalf, the defense of any actions commenced
against the Debtor, negotiations concerning all litigation
in which the Debtor is or will become involved, and the
evaluation and objection to claims filed against the estate;
Snell & Wilmer holds a $98,954 retainer to be applied toward legal
fees and costs in this case. Snell & Wilmer will hold the funds
in its client trust account and will apply the funds to fees and
expenses approved by this Court upon approval of a fee
application.
The attorneys that may be designated to represent the Debtor and
their standard hourly rates are:
Christopher H. Bayley $665
Andrew V. Hardenbrook $270
Melissa Weber, a paralegal at the firm, will bill the Debtor $180
per hour.
To the best of the Debtor's knowledge, Snell & Wilmer's proposed
role as counsel to the Debtor presents no adverse interest to the
Debtor or creditors, and Snell & Wilmer is otherwise disinterested
as that term is defined in 11 U.S.C. Sec. 101(14).
About FR 160
FR 160 LLC, originally named IMH Special Asset NT 160 LLC, was
formed for the purpose of owning 51 residential lots and Tract H
at the Flagstaff Ranch Golf Club Community generally located in
Coconino County, Arizona. In January 2011, to resolve disputes
with the golf club, the parties entered into an agreement where
FR 160 delivered to the golf club a promissory note in the amount
of $4,950,000, a promissory note of $720,000 and a deed of trust
on the real property. FR 160 failed to make certain payments and
the golf club initiated the non-judicial foreclosure process.
FR 160 commenced bankruptcy to stop the trustee's sale of the
property.
FR 160 filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 12-
13116) in Phoenix on June 12, 2012.
FR 160, which claims to be a Single Asset Real Estate as defined
in 11 U.S.C. Sec. 101(51B), estimated assets of up to $50 million
and debts of up to $100 million. Attorneys at Snell & Wilmer
L.L.P., in Phoenix, serve as counsel.
The U.S. Trustee has not appointed an official committee in the
case due to an insufficient number of persons holding unsecured
claims against the Debtor that have expressed interest in serving
on a committee. The U.S. Trustee reserves the right to appoint a
committee should interest develop among the creditors.
Attorneys at Gordon Silver, in Phoenix, represent creditor
Flagstaff Ranch Golf Club as counsel.
FR 160: Can Tap Osborn Maledon & Moyers Sellers as Special Counsel
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The U.S. Bankruptcy Court for the District of Arizona authorized
FR 160, LLC, to employ:
* Osborn Maledon, P.A., as special counsel to defend, among
others, the Debtor in pending actions initiated in Arizona
State Court by third parties; and
* Moyers Sellers & Hendricks as special counsel to attempt to
collect upon and enforce certain judgments owned by the
Debtor.
On or about Nov. 15, 2012, Victor and Julia McCleve; Tract M, LLC;
and Vincent Goett filed an action against Debtor, IMH Financial
Corporation; IMH Special Asset NT 101, LLC; IMH Special Asset NT
118, LLC; and IMH Special Asset NT 132 in the Coconino County
Superior Court, State of Arizona, McCleve v. IMH Financial Corp.,
Case No. CV2012-00757, alleging claims of, among other things,
breach of contract. On or about Nov. 21, 2012, the Debtor, IMHFC,
IMH NT 101, IMH NT 118, and IMH NT 132 retained Osborn Maledon,
P.A., to represent their interests in defense of the State Court
Action. IMHFC is the managing member of IMH NT 101, IMH NT 118
and IMH NT 132. IMHFC is also the managing member of the Debtor.
IMHFC, IMH NT 101, IMH NT 118, and/or IMH NT 132 have agreed to
pay all of the legal fees and costs incurred by Osborn associated
with the State Court Action, and IMHFC, IMH NT 101, IMH NT 118,
and IMH NT 132 will not be seeking any reimbursement from the
bankruptcy estate for these fees and costs.
Prior to commencement of the bankruptcy proceeding, on Jan. 22,
2008, the Maricopa County Superior Court signed a judgment in
favor of Debtor and against the judgment debtor Vincent Goett in
Case No. CV2008-020980 in the amount of $12,213,896 plus accrued
and accruing interest, attorney fees, and costs. On or about
June 25, 2012, Debtor retained Moyes Sellers & Hendricks to
collect upon the FR 160 Judgment. As part of the terms of the
engagement, MSH agreed to accept a contingency fee of 40% of the
gross amounts MSH recovered on the FR 160 Judgment.
To the best of the Debtor's knowledge, the firms do not hold or
represent any entity having an adverse interest to the Debtor or
to the estate with respect to the matter on which they are to be
employed.
About FR 160
FR 160 LLC, originally named IMH Special Asset NT 160 LLC, was
formed for the purpose of owning 51 residential lots and Tract H
at the Flagstaff Ranch Golf Club Community generally located in
Coconino County, Arizona. In January 2011, to resolve disputes
with the golf club, the parties entered into an agreement where
FR 160 delivered to the golf club a promissory note in the amount
of $4,950,000, a promissory note of $720,000 and a deed of trust
on the real property. FR 160 failed to make certain payments and
the golf club initiated the non-judicial foreclosure process.
FR 160 commenced bankruptcy to stop the trustee's sale of the
property. It filed a Chapter 11 petition (Bankr. D. Ariz. Case
No. 12-13116) in Phoenix on June 12, 2012.
FR 160, which claims to be a Single Asset Real Estate as defined
in 11 U.S.C. Sec. 101(51B), estimated assets of up to $50 million
and debts of up to $100 million. Attorneys at Snell & Wilmer
L.L.P., in Phoenix, serve as counsel.
The U.S. Trustee has not appointed an official committee in the
case due to an insufficient number of persons holding unsecured
claims against the Debtor that have expressed interest in serving
on a committee. The U.S. Trustee reserves the right to appoint a
committee should interest develop among the creditors.
Attorneys at Gordon Silver, in Phoenix, represent creditor
Flagstaff Ranch Golf Club as counsel.
FREDERICK'S OF HOLLYWOOD: Had $9.8MM Net Loss in Jan. 26 Quarter
----------------------------------------------------------------
Frederick's of Hollywood Group Inc. filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss of $9.87 million on $24.28 million of net
sales for the three months ended Jan. 26, 2013, as compared with a
net loss of $3.53 million on $32.52 million of net sales for the
three months ended Jan. 28, 2012.
For the six months ended Jan. 26, 2013, the Company incurred a net
loss of $14.95 million on $46.74 million of net sales, as compared
with a net loss of $5.87 million on $60.88 million of net sales
for the six months ended Jan. 28, 2012.
The Company's balance sheet at Jan. 26, 2013, showed
$40.27 million in total assets, $55.83 million in total
liabilities, and a $15.56 million total shareholders' deficiency.
A copy of the Form 10-Q is available for free at:
http://is.gd/MbT3MY
About Frederick's of Hollywood
Frederick's of Hollywood Group Inc. (NYSE Amex: FOH) --
http://www.fredericks.com/-- through its subsidiaries, sells
women's intimate apparel, swimwear and related products under its
proprietary Frederick's of Hollywood brand through 122 specialty
retail stores, a world-famous catalog and an online shop.
Frederick's of Hollywood sought bankruptcy in July 10, 2000. On
Dec. 18, 2002, the court approved the company's plan of
reorganization, which became effective on Jan. 7, 2003, with the
closing of the Wells Fargo Retail Finance exit financing facility.
The Company incurred a net loss of $6.43 million for the year
ended July 28, 2012, compared with a net loss of $12.05 million
for the year ended July 30, 2011.
FRONTIERS MEDIA: Magazine Publisher Wins Interim Cash Use
---------------------------------------------------------
The publisher of Frontiers Magazine received interim approval
yesterday to use cash until a final hearing on April 9.
Frontiers Media, LLC, filed a Chapter 11 petition (Bankr. C.D.
Cal. Case No. 13-15740) on March 6, 2013. Jeffrey S. Shinbrot,
Esq., at The Shinbrot Firm, APLC, in Beverly Hills, California,
serves as counsel. The Debtor disclosed assets of $342,000 and
liabilities totaling $3.2 million, including $2.5 million in
secured debt.
The Debtor publishes Frontiers Magazine, a bi-weekly magazine
calls itself the oldest and largest lesbian, gay, bisexual and
transgender publication in southern California.
FUESTREAM INC: Amends 397,218 Shares Resale Prospectus
------------------------------------------------------
Fuelstream, Inc., filed with the U.S. Securities and Exchange
Commission a pre-effective amendment no. 2 to the Form S-1
registration statement to:
1. To include an unaudited Statement of Cash Flows for the nine
months ended Sept. 30, 2012;
2. To include exhibits to the Securities Purchase Agreement,
dated Oct. 2, 2012, between the Company and Peak One
Opportunity Fund, L.P., that is itself included as an
exhibit to this Registration Statement;
3. To provide additional disclosures regarding the Company and
the debentures issued (and to be issued) by the Company
pursuant to the SPA;
4. To provide additional disclosures and to correct other items
as requested by the Securities and Exchange Commission;
5. To reduce the number of shares to be registered hereunder
due to:
(i) an elimination of the shares to be registered in
connection with the Effective Debenture (as such term
is defined in the SPA); and
(ii) a good faith estimate of the number of shares that are
likely to be issued pursuant to the conversion of the
Signing Debenture and the Filing Debenture.
The shares being registered are comprised of 34,951 shares of
common stock issued to the selling stockholders and 362,267 shares
of common stock that are issuable from the conversion of two
debentures the Company has previously issued to the selling
stockholders in the aggregate principal amount of $220,000. The
first of the Debentures, in the principal amount of $120,000 was
issued on Oct. 2, 2012. The second of the Debentures, in the
principal amount of $100,000, was issued on Feb. 1, 2013. The
Debentures are convertible into shares of common stock at the
lesser of: (i) $0.90, or (ii) 60% of the lowest bid price during
the 20 trading days prior to conversion. Because the ultimate
conversion price of the Debentures is unknown, the Company
increased by 48.2% the number of shares that would be issued to
the selling stockholders if the Debentures were converted at $0.90
per share.
The Company's common stock is traded on the over-the-counter
market under the symbol "FLST". The closing bid price for the
Company's common stock on March 8, 2013, was $2.75 per share, as
reported by the OTCQB.
A copy of the amended prospectus is available for free at:
http://is.gd/23VnhZ
About Fuelstream
Draper, Utah-based Fuelstream, Inc., is an in-wing and on-location
supplier and distributor of aviation fuel to corporate,
commercial, military, and privately-owned aircraft throughout the
world. The Company also provides a variety of ground services
either directly or through its affiliates, including concierge
services, passenger andbaggage handling, landing rights,
coordination with local aviation authorities, aircraft maintenance
services, catering, cabin cleaning, customsapprovals, and third-
party invoice reconciliation. The Company's personnel assist
customers in flight planning and aircraft routing aircraft,
obtaining permits, arranging overflies, and flight follow
services.
Morrill & Associates, LLC, in Bountiful, Utah, expressed
substantial doubt about Fuelstream's ability to continue as a
going concern, following the Company's results for the fiscal year
ended Dec. 31, 2011. The independent auditors noted that the
Company has negative working capital, negative cash flows from
operations and recurring operating losses.
The Company's balance sheet at Sept. 30, 2012, showed
$3.04 million in total assets, $4.87 million in total liabilities
and a $1.82 million total stockholders' deficit.
GATEWAY HOTEL: Court Terminates Chapter 11 Case
-----------------------------------------------
The Hon. James M. Marlar of the U.S. Bankruptcy Court for the
District of Arizona terminated Gateway Hotel LLC's Chapter 11 case
on Feb. 27, 2013.
An order dismissing the case was entered by the Bankruptcy Court
on Dec. 8, 2012, after the presentations of counsel and statements
of the Court on the record at the Dec. 5 hearing on the show cause
order.
The Berger Company attempted to prevent the dismissal by filing on
Dec. 4 an emergency motion that also sought to postpone the
foreclosure proceedings regarding the Debtor's hotel property, and
to revalue hotel property in connection with an amended plan of
reorganization. On information and belief, the Debtor supported
the emergency motion.
The Court denied confirmation of the Debtor's Plan of
Reorganization Dated May 12, 2011, and further granted the
Debtor's primary secured creditor, 2010-1 SFG Venture LLC, relief
from the automatic stay to foreclose on the Debtor's primary
asset, a 192-room Hilton hotel near Phoenix Sky Harbor Airport.
SFG is scheduled to foreclose on the Hilton Property on or around
Jan. 15, 2013.
The Court encouraged the Debtor to amend the Original Plan.
Heeding this Court's advice and in furtherance of its fiduciary
duty to the estate, the Debtor located The Berger Company -- a
potential investor familiar with the hospitality industry -- that
subject to certain conditions would inject up to $3 million into
the Debtor so that it can emerge from Chapter 11. According to
the Berger Company, it has not yet completed the necessary due
diligence to submit a final, binding term sheet, but the Debtor
and the Berger Company are "far enough along in their discussions
to warrant the request sought" by the Emergency Motion.
The Berger Company said in its Emergency Motion that one of the
conditions necessary for it to make its investment is that the
Court "revisit its previous order setting the value of the Hotel
Property nearly a year ago. Among other things, the value of the
Hotel Property, and in turn the amount of SFG's secured claim,
will need to be approximately $15 million for The Berger Company
to invest in the Debtor. This is the precise value SFG argued the
Hotel Property was worth earlier this year. Moreover, the
projections used to support the Court's valuation order did not
pan out over the last year, and the Debtor used lower projections
in connection with confirmation of the Original Plan, which the
Court denied on feasibility grounds."
The Berger Company is represented by:
QARLES & BRADY LLP
Kelly Singer, Esq.
Isaac M. Gabriel, Esq.
One Renaissance Square
Two North Central Avenue
Phoenix, AZ 85004-2391
Tel: (602) 229-5200
E-mail: kelly.singer@quarles.com
isaac.gabriel@quarles.com
On Dec. 5, 2012, the Court granted the motion for withdrawal of
Bryan Cave LLP as the Debtor's counsel.
About Gateway Hotel
Phoenix, Arizona-based Gateway Hotel, LLC -- aka Hilton Garden Inn
and Hilton Garden Inn Phoenix Airport North -- is primarily
engaged in the hotel and restaurant business. It filed for
Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 11-
08302) on March 29, 2011. Robert J. Miller, Esq., Bryce A.
Suzuki, Esq., Kyle S. Hirsch, Esq., at Bryan Cave LLP, serve as
the Debtor's bankruptcy counsel. The Debtor estimated its assets
and debts at $10 million to $50 million.
Affiliate Windsor Commercial Construction, LLC, filed a separate
Chapter 11 petition (Bankr. D. Ariz. Case No. 09-25724) on
Oct. 13, 2009.
GEOKINETICS INC: Terminates Registration of Securities
------------------------------------------------------
Geokinetics Inc. filed with the U.S. Securities and Exchange
Commission post-effective amendments to its Form S-8 registration
statements to remove from registration any unissued shares of
common stock under the Awards Plans that were previously
registered under the Registration Statements and to terminate the
effectiveness of the Registration Statements:
(a) 1,600,000 shares of common stock, par value $0.01 per share
for issuance under the Company's 2010 Stock Awards Plan;
(b) 464,845 shares of common stock, par value $0.01 per share
for issuance under the Company's 2002 Stock Awards Plan;
(c) 750,000 shares of common stock, par value $0.01 per share
for issuance under the Company's 2007 Stock Awards Plan;
(d) 3,351,556 shares of common stock, par value $0.01 per share
for issuance under the Company's 2002 Stock Awards Plan;
As previously disclosed, on March 10, 2013, the Company and its
domestic subsidiaries filed voluntary petitions for relief under
Chapter 11 of Title 11 of the United Code in the United States
Bankruptcy Court for the District of Delaware. As contemplated by
the Debtors' Joint Plan of Reorganization, all equity interests in
the Company, including shares of Common Stock and any purchase
rights, options, warrants, or other instruments or documents
directly or indirectly evidencing or creating any equity interest
in the Company, will be cancelled on the effective date of the
Bankruptcy Plan.
Geokinetics also removed from registration any shares of common
stock registered under its Form S-3 registration statements that
remain unsold and to terminate the effectiveness of the
Registration Statements:
(a) Form S-3 which registered 1,041,668 shares of common stock,
par value $0.01 per share for resale by certain selling
stockholders; and
(b) Form S-3 which was declared effective on May 9, 2011, to
register 2,153,616 shares of common stock, par value $0.01
per share, and 1,165,000 shares of Common Stock issuable
upon exercise of warrants for resale by certain selling
stockholder.
About Geokinetics Inc.
Headquartered in Houston, Texas, Geokinetics Inc., a Delaware
corporation founded in 1980, provides seismic data acquisition,
processing and integrated reservoir geosciences services, and
land, transition zone and shallow water OBC environment
geophysical services.
The Company's balance sheet at Sept. 30, 2012, showed
$415.71 million in total assets, $590.79 million in total
liabilities, $90.72 million in mezzanine equity, and a
$265.80 million total stockholders' deficit.
For the first three quarters of 2012, the net loss was
$64.5 million. For 2011, there was a $231.2 million net loss on
revenue of $763.7 million.
Geokinetics Inc. and its nine affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 13-10472) on March 10,
2013, with a prepackaged Chapter 11 plan that converts $300
million of senior secured notes into 100% of the reorganized
Company's common stock.
Akin Gump Strauss Hauer & Feld LLP serves as counsel to the
Debtors; Richards, Layton & Finger, P.A., is co-counsel;
Rothschild Inc. is the financial advisor and investment banker;
UHY LLP is the independent auditor; and GCG, Inc., is the claims
agent and administrative agent.
GEOKINETICS INC: Seeks OK for E&Y as Tax Advisor
------------------------------------------------
BankruptcyData reported that Geokinetics filed with the U.S.
Bankruptcy Court a motion to retain Ernst & Young (Contact:
Geoffrey C. Koslov) to provide tax advisory, accounting and other
services at the following hourly rates: partner, principal,
executive director at $595 to $795, senior manager at $450 to
$635, manager at $395 to $500, senior at $295 to $410 and staff at
$171 to $258.
About Geokinetics Inc.
Headquartered in Houston, Texas, Geokinetics Inc., a Delaware
corporation founded in 1980, 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 Debtors filed voluntary petitions for relief under Chapter 11
of Title 11 of the U.S. Code (Bankr. D. Del. Case Nos. 13-10472-
13-10481) on March 10, 2013. The Debtors' Chapter 11 cases are
being jointly administered under the Company's caption and case
number, In re: Geokinetics Inc. et al., Chapter 11 Case No. 13-
10472.
Gary L. Pittman signed the petition as executive vice president
and chief financial officer. Judge Kevin Carey presides over the
case. Akin Gump Strauss Hauer & Feld LLP serves as the Debtors'
counsel. Rothschild Inc. acts as the Debtors' financial advisor
while UHY LLP serves as th independent auditor. GCG Inc. is the
Debtors' claims and noticing agent. Geokinetics Inc. disclosed
$12,119,439 in total assets and $350,756,244 in total liabilities
at Feb. 28, 2013.
GGW BRANDS: Wynn Las Vegas Wants Trustee to Take Over Ch. 11
------------------------------------------------------------
Lance Duroni of BankrutpcyLaw360 reported that Wynn Las Vegas LLC
moved Thursday to appoint a Chapter 11 trustee to oversee the
"Girls Gone Wild" video franchise's bankruptcy, saying GGW founder
Joe Francis was looting the raunchy media company and using it to
dodge his own creditors.
The report related that the casino -- whose $10.3 million claim
from a defamation judgment against Francis helped push GGW into
Chapter 11 -- said in a motion filed in California bankruptcy
court that despite stepping down as manager of the company,
Francis continued to divert GGW assets.
About GGW Brands
Santa Monica, California-based GGW Brands, LLC, the company behind
the "Gils Gone Wild" video, filed a Chapter 11 petition on
February 27, 2013, at the U.S. Bankruptcy Court Central District
of California (Los Angeles). The case is assigned Bankruptcy Case
No. 13-15130. Judge Sandra R. Klein oversees the case.
The company is represented by the Law Offices of Robert M. Yaspan.
The company disclosed $0 to $50,000 in estimated assets and
$10,000,001 to $50,000,000 in estimated liabilities in its
petition.
GOLDEN GUERNSEY: Secures $5.5M Stalking Horse Bid
-------------------------------------------------
Jake Simpson of BankruptcyLaw360 reported that a Delaware
bankruptcy judge on Friday approved a stalking horse bid by the
parent of Superior Dairy Inc. to purchase the assets of private
equity-backed milk processor Golden Guernsey Dairy LLC for
$5.5 million.
According to the report, U.S. Bankruptcy Judge Kevin Gross
approved the stalking horse bid by LEL Operating Co., parent of
Canton, Ohio-based Superior Dairy, and set an auction for May 14,
should Golden Guernsey receive any competing offers.
"[Golden Guernsey trustee Charles A. Stanziale Jr.] has
demonstrated a compelling and sound business justification for
entering into the sale agreement, the report said, citing Judge
Gross.
About Golden Guernsey
Waukesha, Wisconsin-based milk processor Golden Guernsey, LLC,
filed for Chapter 7 bankruptcy (Bankr. D. Del. Case No. 13-10044)
in January 2013 following the Jan. 5 closing of its facility.
OpenGate Capital, LLC, a private investment and acquisition firm,
acquired Golden Guernsey in September 2011 from Dean Foods after
the United States Department of Justice required Dean Foods to
sell the business to resolve antitrust concerns that Dean Foods'
share of the school milk supply business was too large.
The Chapter 7 petition stated that assets and debt both exceed
$10 million.
Charles Stanziale was appointed Chapter 7 trustee.
GOOD SAM: Posts $9.4 Million Net Income in 2012
-----------------------------------------------
Good Sam Enterprises, LLC, filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing net
income of $9.37 million on $518.74 million of revenue for the year
ended Dec. 31, 2012, as compared with net income of $3.90 million
on $481.40 million of revenue in 2011.
The Company's balance sheet at Dec. 31, 2012, showed
$230.36 million in total assets, $474.15 million in total
liabilities, and a $243.79 million total members' deficit.
A copy of the Form 10-K is available for free at:
http://is.gd/8F8j1A
About Good Sam
Ventura, Calif.-based Affinity Group Holding, Inc., now known as
Good Sam Enterprises, LLC, is a holding company and the direct
parent of Affinity Group, Inc. The Company is an indirect wholly-
owned subsidiary of AGI Holding Corp, a privately-owned
corporation. The Company is a member-based direct marketing
organization targeting North American recreational vehicle owners
and outdoor enthusiasts. The Company operates through three
principal lines of business, consisting of (i) club memberships
and related products and services, (ii) subscription magazines and
other publications including directories, and (iii) specialty
merchandise sold primarily through its 78 Camping World retail
stores, mail order catalogs and the Internet.
* * *
Affinity Group Inc. carries 'B3' long term corporate family and
probability of default ratings, with 'stable' outlook, from
Moody's Investors Service.
As reported in the Troubled Company Reporter on November 9, 2010,
Standard & Poor's Ratings Services assigned Affinity Group Inc.'s
proposed $325 million senior secured notes due 2016 its
preliminary 'B-' issue-level rating. Following the close of the
proposed transaction, S&P expects to assign a 'B-' corporate
credit rating to Affinity Group Inc., and withdraw S&P's current
'D' corporate credit rating on Affinity Group Holding Inc. A
portion of the proceeds of the new notes will be used, in
conjunction with cash contributions from Holding's parent, to
repay in full $88 million of senior notes that are currently
outstanding at Holding.
S&P said the expected 'B-' corporate credit rating on Affinity
Group reflects S&P's expectation that, following the proposed
refinancing transaction, adjusted debt leverage will be reduced by
about 1x, the company will not have any meaningful near-term debt
maturities, and the company will generate some discretionary cash
flow (albeit minimal). Still, credit measures will remain
relatively weak, as adjusted debt leverage will remain above 6.0x
(S&P's operating lease adjustment adds about a turn to leverage),
and S&P expects interest coverage to remain in the low- to mid-
1.0x area over the intermediate term.
GORDON PROPERTIES: March 26 Hearing Set on Additional Borrowing
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Virginia has
set for March 26, 2013, at 11:00 a.m., a hearing on Gordon
Properties, LLC's request for an order authorizing the Debtor to
borrow money on a subordinated secured basis.
Early in the case, the Debtor exhausted its cash supporting its
business operations and litigation expenses. The Debtor had filed
a motion for authority to borrow money from its principals on a
secured subordinated basis, and the Court entered an order
approving the motion. Subsequently, the Debtor filed its second
motion for borrowing authority, and the Court entered an order
approving the second motion. Since that time, the borrowing
authority has been exhausted, and the Debtor requires additional
borrowing in order to meet its operating and litigation expenses.
The Debtor said that all or some of its owners are prepared to
lend money to help fund its ongoing cash needs.
The Debtor is owned and operated by family members Bryan Sells,
Elizabeth Sells, Lindsay Wilson, and Julie Langdon, each of whom
owns 25% of the membership interests.
The Owners are prepared to lend the Debtor up to $500,000 on an
ongoing basis asand when funds may be required, pursuant to the
terms of a commercial credit line promissory note and credit line
deed of trust, similar in form and content to the note and deed of
trust utilized in the prior borrowing motions. The collateral
intended to secure the Loan will be one or more of the
unencumbered condominium units owned by Gordon Properties at The
Forty Six Hundred Condominium.
The Debtor said that it is solvent and believes that entering into
the loan and granting the Owners the deed of trust to secure the
loan won't impair the Debtor's ability to pay claims in its case.
The Owners have agreed to subordinate their right to payment under
the note and deed of trust to all allowed claims, that is, the
Owners agree to subordinate their right to payment under the notes
and deed of trust to the rights of all allowed claimants in the
case. The Debtor assured the Court that no creditor will be
adversely affected by the loan.
About Gordon Properties
Alexandria, Va.-based Gordon Properties, LLC, owns 40 condominium
units in a high-rise apartment building with both residential and
commercial units and two commercial units adjacent to the high-
rise building. Gordon Properties' ownership of these condos
represents about a 20% interest in the Forty Six Hundred
Condominium project -- http://foa4600.org/-- in Alexandria.
Gordon Properties also owns one of the adjacent commercial units,
a restaurant. Gordon Properties sought Chapter 11 protection
(Bankr. E.D. Va. Case No. 09-18086) on Oct. 2, 2009, and is
represented by Donald F. King, Esq., at Odin, Feldman & Pittleman
PC in Fairfax, Va. Gordon Properties disclosed $11,149,458 in
assets and $1,546,344 in liabilities.
Condominium Services filed its chapter 11 petition (Bankr. E.D.
Va. 10-10581) on Jan. 26, 2010. It scheduled one creditor, the
condominium association, with a disputed claim of $436,802.00.
The association filed a proof of claim asserting a claim of
$453,533.12. A second proof of claim was filed by the Internal
Revenue Service for $1,955.45. According to its schedules, if
both claims are allowed, it has a net deficit of about $426,900.
CSI is wholly owned by Gordon Properties.
In February 2012, Judge Mayer denied the motion of the association
to substantively consolidate the chapter 11 bankruptcy cases of
Gordon Properties and Condominium Services, Inc., the condominium
management company.
Gordon Properties and CSI opposed the motion. The two cases were
previously administratively consolidated.
GREEN EARTH: Amends 55 Million Common Shares Prospectus
-------------------------------------------------------
Green Earth Technologies, Inc., has filed an amended Form S-1
relating to the sale, from time to time, by certain stockholders
of up to 55,147,059 shares of the Company's common stock, of which
36,764,706 shares are issuable upon exercise of the conversion
rights contained in our 6.0% Secured Convertible Debentures due
Dec. 31, 2014, in the aggregate principal of $6,250,000 and
18,382,353 shares are issuable upon exercise of warrants expiring
Dec. 31, 2016. The conversion price of the Debentures and the
exercise price of the Warrants are $0.17 and $0.21 per share,
respectively.
The Company will not receive any proceeds from the sale of these
shares by the Selling Stockholders. However, the Company did
realize gross proceeds of $6,250,000 from the sale of the
Debentures and Warrants and the Company will realize gross
proceeds of $3,860,294 if all of the Warrants are exercised.
The Company's common stock is registered under Section 12(g) of
the Securities Exchange Act of 1934, as amended, and is quoted on
the OTC Bulletin Board under the symbol "GETG."
A copy of the amended Form S-1 is available for free at:
http://is.gd/BU2EwO
About Green Earth Technologies
White Plains, N.Y.-based Green Earth Technologies, Inc. (OTC QB:
GETG) -- http://www.getg.com/-- markets, sells and distributes
bio-degradable performance and cleaning products. The Company's
product line crosses multiple industries including the automotive
aftermarket, marine and outdoor power equipment markets.
Green Earth reported a net loss of $11.26 million for the year
ended June 30, 2012, compared with a net loss of
$12.21 million during the prior fiscal year.
Friedman LLP, in East Hanover, New Jersey, issued a "going
concern" qualification on the consolidated financial statements
for the fiscal year ended June 30, 2012. The independent auditors
noted that the Company's losses, negative cash flows from
operations, working capital deficit and its ability to pay its
outstanding liabilities through fiscal 2013 raise substantial
doubt about its ability to continue as a going concern.
The Company's balance sheet at Sept. 30, 2012, showed
$3.78 million in total assets, $12.63 million in total
liabilities, and a $8.85 million total stockholders' deficit.
H&M OIL: Trustee Can Hire PLS Inc. as Marketing Agent
-----------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas
permitted Douglas J. Brickley, the chapter 11 trustee of H&M Oil &
Gas, LLC, and Anglo-American Petroleum Corporation to employ PLS,
Inc., as Marketing Agent.
On Jan. 18, 2013, the Trustee filed a Sale Motion that
contemplates a sale of substantially all of the assets of the
Debtors' estates, including H&M's oil and gas properties in the
Permian Basin and the Texas Panhandle, H&M's ownership interests
in H&M Resources, LLC, cash, accounts receivable and any other
personal property (but excluding H&M's ownership interests in 1519
Main Street, LP) to Prospect Capital Corporation pursuant to
Section 363 of the Bankruptcy Code. The Sale Motion, however,
also authorizes the Trustee to provide information to prospective
purchasers and accept an offer that is higher and better than
Prospect's current bid. Accordingly, the Trustee has determined
that it is in the best interest of the Debtors' estates and
creditors that the Debtors' Assets be marketed by a professional
marketing agent.
PLS will provide marketing and advisory services, which generally
include, but are not limited to: preparing formal and informal
sales materials for presentation to potential purchasers; running
anonymous listings and advertising the Assets in PLS's reports,
listing service and website; selecting, contacting and pre-
qualifying potential operators or working interest purchasers;
disseminating information to potential purchasers; following up
with potential purchasers; promoting the internet data room;
scheduling formal Asset presentations; soliciting, encouraging and
aggregating offers and handling negotiations as and when
applicable.
PLS's engagement fee is $25,000. PLS will receive a success fee
upon closing of the sale of the Assets equal to 5.0% of the first
$1 million of total purchase price, plus 1.0% of any amount of
total purchase price over $1 million. The Success Fee will be
paid upon Court approval of a final fee application. However, PLS
will not be entitled to payment of the Success Fee in the event
the assets are sold to Prospect or an affiliate of Prospect.
The Trustee will indemnify PLS from any third-party claims,
demands, causes of action, and costs including attorney's fees
arising out of PLS's performance of the Marketing Agreement.
To the best of the Trustee's knowledge, PLS does not have any
connection with or any interest adverse to the Trustee, the
Debtors, their creditors, the United States Trustee, or any other
party-in-interest, or their attorneys and accountants.
About H&M Oil
H&M Oil & Gas, LLC, filed a bare-bones Chapter 11 petition
(Bankr. N.D. Tex. Case No. 12-32785) in its hometown Dallas on
April 30, 2012. Another entity, Anglo-American Petroleum Corp.
(Case No. 12-32786) simultaneously filed for Chapter 11. H&M Oil
disclosed $297,119,773 in assets and $77,463,479 in liabilities as
of the Chapter 11 filing.
H&M Oil & Gas is an oil and gas production and development
company. H&M, through its operating company, H&M Resources LLC,
is focused on developing its leases in the Permian basin and Texas
panhandle. Dallas, Texas-based Anglo-American Petroleum --
http://www.angloamericanpetroleum.com/-- is the holding
corporation for H&M Oil.
Judge Barbara J. Houser presides over the case. The Debtors are
represented by Keith William Harvey, Esq., at Anderson Tobin PLLC,
in Dallas. Lain Faulkner & Co., PC, serves as financial adviser.
The Debtor filed a Plan in October 2012, designed to pay lender
Prospect Capital Corp. by delivery of crude oil rather than cash.
In November 2012, the bankruptcy judge approved the appointment of
a trustee to replace management. The advent of a trustee
automatically allows creditors to file reorganization plans. In
addition to seeking appointment of a trustee, Prospect had been
seeking permission to file a plan competing with H&M's.
Douglas J. Brinkley, of The Claro Group, LLC, has been appointed
as the Chapter 11 trustee. The U.S. Trustee selected Mr. Brinkley
following after consultation with Keith Harvey, counsel for the
Debtors, and Jason Brookner, counsel for the creditor.
H&M OIL: Court OKs Russell K. Hall as Trustee's Reserve Engineers
-----------------------------------------------------------------
Douglas J. Brickley, the Chapter 11 trustee of H&M Oil & Gas, LLC
and Anglo-American Petroleum Corporation, sought and obtained
court permission to employ Russell K. Hall and Associates, Inc.,
as reserve engineers, nunc pro tunc to Oct. 1, 2012.
Hall will provide various professional services in the Chapter 11
Case, including but not limited to providing geoscience consulting
services, as well as organizing and preparing materials for the
presentation of geological, engineering and reserves aspects of
the Debtors' oil and gas assets. Hall has analyzed and evaluated
the Debtors' oil and gas properties in order to assist the Debtors
and Trustee regarding a potential asset sale. In addition, Hall
will assist the Trustee in responding to any objections thereto,
and may provide testimony before this Court in connection with any
sale.
Hall's standard hourly rates are:
* Petroleum Engineers at $375 per hour for evaluation work and
$750 per hour for testimony;
* Engineering Assistants at $160 per hour; and
* Administrative Assistants at $60 per hour.
To the best of the Trustee's knowledge, the members of Hall are
"disinterested persons," as that term is defined in Section
101(14) of the Bankruptcy Code.
About H&M Oil
H&M Oil & Gas, LLC, filed a bare-bones Chapter 11 petition
(Bankr. N.D. Tex. Case No. 12-32785) in its hometown Dallas on
April 30, 2012. Another entity, Anglo-American Petroleum Corp.
(Case No. 12-32786) simultaneously filed for Chapter 11. H&M Oil
disclosed $297,119,773 in assets and $77,463,479 in liabilities as
of the Chapter 11 filing.
H&M Oil & Gas is an oil and gas production and development
company. H&M, through its operating company, H&M Resources LLC,
is focused on developing its leases in the Permian basin and Texas
panhandle. Dallas, Texas-based Anglo-American Petroleum --
http://www.angloamericanpetroleum.com/-- is the holding
corporation for H&M Oil.
Judge Barbara J. Houser presides over the case. The Debtors are
represented by Keith William Harvey, Esq., at Anderson Tobin PLLC,
in Dallas. Lain Faulkner & Co., PC, serves as financial adviser.
The Debtor filed a Plan in October 2012, designed to pay lender
Prospect Capital Corp. by delivery of crude oil rather than cash.
In November 2012, the bankruptcy judge approved the appointment of
a trustee to replace management. The advent of a trustee
automatically allows creditors to file reorganization plans. In
addition to seeking appointment of a trustee, Prospect had been
seeking permission to file a plan competing with H&M's.
Douglas J. Brinkley, of The Claro Group, LLC, has been appointed
as the Chapter 11 trustee. The U.S. Trustee selected Mr. Brinkley
following after consultation with Keith Harvey, counsel for the
Debtors, and Jason Brookner, counsel for the creditor.
HANOVER INSURANCE: Fitch Rates $175MM Subordinated Debt 'BB'
------------------------------------------------------------
Fitch Ratings has assigned a 'BB' rating to The Hanover Insurance
Group's (NYSE: THG) issuances of $175 million in subordinated
debentures maturing March 30, 2053.
Key Rating Drivers
THG will use the notes for general corporate and working capital
purposes, which may include repurchases of its common stock. THG's
pro forma financial leverage ratio (FLR) is 29.7%. This compares
to a FLR of 26.8%, excluding FAS 115, at Dec. 31, 2012. The pro
forma figure includes THG's repayment of $46 million in FHLBB
borrowings in January 2013.
THG's interest coverage has been subpar over the last two years
due to lower profitability with above average catastrophe related
losses. GAAP operating EBIT coverage was 2.3x in 2011 and 2.2X in
2012. Holding company cash and investments was $164 million at
Dec. 31, 2012. Statutory interest coverage is projected at
approximately 2.5x in 2013.
Rating Sensitivities
Key ratings triggers that could lead to a downgrade include: a
material and sustained deterioration in the Prism score and/or
material increases in GAAP operating leverage from current levels;
GAAP operating EBIT coverage below 5x and maintenance of parent
company cash and investments less than 2x annual interest expense;
a further material deterioration in underwriting or operating
performance relative to peers; and a material deterioration in
THG's reserve adequacy.
Key ratings triggers that could lead to an upgrade include
underwriting results and consolidated profitability comparable to
higher rated peer companies and industry averages; improvement in
the Prism score to 'strong'; and maintenance of the run-rate
holding company financial leverage ratio below 25%.
Fitch has assigned these rating:
The Hanover Insurance Group
-- $175 million subordinated debentures due March 30, 2053 'BB'.
THG's ratings were affirmed with a Stable Outlook on March 18,
2013 as follows:
The Hanover Insurance Group
-- IDR at 'BBB';
-- 7.5% senior notes due 2020 'BBB-';
-- 6.375% senior unsecured notes due 2021 at 'BBB-';
-- 7.625% senior unsecured notes due 2025 at 'BBB-';
-- 8.207% junior subordinated debentures due 2027 at 'BB'.
The Hanover Insurance Company
Citizens Insurance Company of America
-- IFS at 'A-'.
HANOVER INSURANCE: S&P Rates New Subordinated Debentures 'BB'
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it has assigned its
'BB' rating to The Hanover Insurance Group Inc.'s (THG) proposed
subordinated debentures maturing in 2053. The debentures are
expected to qualify for equity treatment under Standard & Poor's
criteria for hybrid securities, based on a review of preliminary
documentation.
The company intends to use the net proceeds from this issue for
general corporate purposes including share repurchases. Adjusted
debt leverage and financial leverage as of Dec. 31, 2012, was
supportive of the rating at about 25%. On a pro forma basis,
considering both this issuance and a recent debt paydown, S&P
expects debt leverage below 25% and financial leverage below 30%,
and fixed-charge coverage of at least 4x for 2013 and 2014.
S&P's counterparty credit rating on THG and insurer financial
strength ratings on its subsidiaries reflect the group's strong
competitive position and stable operating performance. THG
maintains a strong capital position and management continues to
execute its strategy successfully to refocus on its balanced
property/casualty business and geographic expansion. While
earnings are stable, The Hanover has earnings volatility arising
from its geographic concentration in the Northeast U.S. with its
potentially large catastrophe risks (as shown by Superstorm Sandy)
and a relatively high expense structure that continues to be a
weakness and limits the rating.
RATING LIST
The Hanover Insurance Group Inc.
Counterparty Credit Rating BBB-/Stable/--
NEW RATING
The Hanover Insurance Group Inc.
Sub debentures due 2053 BB
HAWAII OUTDOOR: Hearing on Further Use of Cash Today
----------------------------------------------------
At a hearing on Feb. 25, the Bankruptcy Court continued, by
agreement of Lender First-Citizens Bank & Trust Company and Debtor
Hawaii Outdoor Tours, Inc., the further interim hearing on the
Debtor's use of Lender's cash collateral to March 25, 2013, at
10:30 a.m.
First-Citizens Bank holds a first priority security interest in
all property of the Debtor, including cash collateral, as security
for a loan in the principal amount of approximately $9,736,403.67,
together with interest and other fees under the Secured Loan
Agreements.
The State of Hawaii Department of Taxation claims junior lien
interests in the assets of the Debtor as security for a tax claim
in the amount of $473,536 as of the Petition Date.
On Feb. 25, 2013, the Bankruptcy Court entered a third stipulated
interim order authorizing the Debtor's use of cash collateral
until Feb. 25, 2013.
As adequate protection, the Debtor will pay to First-Citizens Bank
by Feb. 20, 2012, and thereafter monthly payments of at least
$55,000, paid no later than the 20th day of each month.
First-Citizens Bank is also granted a senior replacement lien in
all of the borrower accounts created from and after the Petition
Date and all of the Debtor's prepetition collateral and related
proceeds.
The State of Hawaii Department of Taxation is granted a second
priority replacement lien in all of the Borrower Accounts created
from after after the Petition Date and all of the prepetition
collateral and associated proceeds.
The Debtor acknowledges and reaffirms the validity of the super-
priority claim allowed and authorized by the Court in favor of
First-Citizens Bank in the amount of $262,000 plus interest
accruing at 6.50% per annum from and after Dec. 27, 2012. First-
Citizens Bank made the August lease payment of $262,000 to the
DLNR, on behalf of the Debtor, with court approval pursuant to the
Second Interi9m Cash Collateral order on Dec. 27, 2012.
About Hawaii Outdoor Tours
Hawaii Outdoor Tours, Inc., operator of the Niloa Volcanoes
Resort in Hilo, Hawaii, filed a Chapter 11 petition (Bankr. D.
Haw. Case No. 12-02279) in Honolulu on Nov. 20, 2012. Niloa
Volcanoes is a 382-room hotel with a nine-hole golf course. The
64-acre property is subject to a 65-year lease, commencing Feb. 1,
2006, and provides for a total ground rent for the first 10 years
of $500,000 annually. The Debtor used a $10 million loan from
First Regional Bank and $10 million of its own cash to invest in
the property.
First-Citizens Bank & Trust Company, which acquired the First
Regional note from the Federal Deposit Insurance Corp., commenced
foreclosure proceedings in August. First-Citizens Bank asserts a
claim of $9.95 million. The Debtor believes that the value of the
hotel property exceeds the amount of the First-Citizens Bank note.
Just the bricks and mortal alone was valued in excess of $35
million by First Regional's appraiser and the insurance company.
Bankruptcy Judge Robert J. Faris oversees the case. Wagner Choi &
Verbrugge acts as bankruptcy counsel.
In its schedules, the Debtor dislcosed $52,492,891 in assets and
$11,756,697 in liabilities. The petition was signed by CEO
Kenneth Fujiyama.
Ted N. Petitt, Esq., represents Secured Creditor First-Citizens
Bank as counsel. Cynthia M. Johiro, Esq., represents the State of
Hawaii Department of Taxation as counsel.
HEALTHWAREHOUSE.COM INC: L. Dhadphale Holds 25% Stake at Feb. 1
---------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Lalit Dhadphale disclosed that, as of Feb. 1,
2013, he beneficially owns 4,380,053 shares of common stock of
Healthwarehouse.com, Inc., representing 25.4% of the shares
outstanding. Mr. Dhadphale reported beneficial ownership of
2,296,720 common shares or a 19.1% equity stake at June 28, 2012.
A copy of the amended filing is available at http://is.gd/mEMpOD
About HealthWarehouse.com
HealthWarehouse.com, Inc., headquartered in Florence, Kentucky, is
a U.S. licensed virtual retail pharmacy ("VRP") and healthcare e-
commerce company that sells brand name and generic prescription
drugs as well as over-the-counter ("OTC") medical products.
The Company's balance sheet at June 30, 2012, showed $2.24 million
in total assets, $6.82 million in total liabilities, $752,226 in
redeemable preferred stock, and a $5.33 million total
stockholders' deficiency.
The Company reported a net loss of $5.71 million in 2011, compared
with a net loss of $3.69 million in 2010.
"Since inception, the Company has financed its operations
primarily through product sales to customers, debt and equity
financing agreements, and advances from stock holders. As of
June 30, 2012 and December 31, 2011, the Company had negligible
cash and working capital deficiency of $5,724,914 and $2,404,464,
respectively. For the six months ended June 30, 2012, cash flows
included net cash used in operating activities of $581,948, net
cash provided by investing activities of $138,241 and net cash
provided by financing activities of $443,846. Additionally, all
of the Company's outstanding convertible notes payable mature at
the end of December 2012 and outstanding notes payable mature in
January 2013. These conditions raise substantial doubt about the
Company's ability to continue as a going concern," the Company
said in its quarterly report for the period ended June 30, 2012.
In the auditors' report accompanying the consolidated financial
statement for the year ended Dec. 31, 2011, Marcum LLP, in New
York, expressed substantial doubt about HealthWarehouse.com's
ability to continue as a going concern. The independent auditors
noted that the Company has incurred significant losses and needs
to raise additional funds to meet its obligations and sustain its
operations.
HEALTHWAREHOUSE.COM INC: Cape Bear Holds 8% Stake at Feb. 1
-----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Cape Bear Partners LLC disclosed that, as of
Feb. 1, 2013, it beneficially owns 1,224,579 shares of common
stock of HealthWarehouse.com representing 8% of the shares
outstanding. Cape Bear previously reported beneficial ownrship of
1,222,468 common shares or a 10.4% equity stake as of June 28,
2012. A copy of the amended filing is available for free at:
http://is.gd/t3Gghu
About HealthWarehouse.com
HealthWarehouse.com, Inc., headquartered in Florence, Kentucky, is
a U.S. licensed virtual retail pharmacy ("VRP") and healthcare e-
commerce company that sells brand name and generic prescription
drugs as well as over-the-counter ("OTC") medical products.
The Company's balance sheet at June 30, 2012, showed $2.24 million
in total assets, $6.82 million in total liabilities, $752,226 in
redeemable preferred stock, and a $5.33 million total
stockholders' deficiency.
The Company reported a net loss of $5.71 million in 2011, compared
with a net loss of $3.69 million in 2010.
"Since inception, the Company has financed its operations
primarily through product sales to customers, debt and equity
financing agreements, and advances from stock holders. As of
June 30, 2012 and December 31, 2011, the Company had negligible
cash and working capital deficiency of $5,724,914 and $2,404,464,
respectively. For the six months ended June 30, 2012, cash flows
included net cash used in operating activities of $581,948, net
cash provided by investing activities of $138,241 and net cash
provided by financing activities of $443,846. Additionally, all
of the Company's outstanding convertible notes payable mature at
the end of December 2012 and outstanding notes payable mature in
January 2013. These conditions raise substantial doubt about the
Company's ability to continue as a going concern," the Company
said in its quarterly report for the period ended June 30, 2012.
In the auditors' report accompanying the consolidated financial
statement for the year ended Dec. 31, 2011, Marcum LLP, in New
York, expressed substantial doubt about HealthWarehouse.com's
ability to continue as a going concern. The independent auditors
noted that the Company has incurred significant losses and needs
to raise additional funds to meet its obligations and sustain its
operations.
HORIZON LINES: Incurs $17.9 Million Net Loss in Fourth Quarter
--------------------------------------------------------------
Horizon Lines, Inc., reported a net loss of $17.97 million on
$259.82 million of operating revenue for the quarter ended
Dec. 23, 2012, as compared with a net loss of $63.56 million on
$264.08 million of operating revenue for the quarter ended
Dec. 25, 2011.
For the year ended Dec. 23, 2012, the Company incurred a net loss
of $94.69 million on $1.07 billion of operating revenue, as
compared with a net loss of $229.41 million on $1.02 billion of
operating revenue for the year ended Dec. 25, 2011.
The Company's balance sheet at Dec. 23, 2012, showed
$601.23 million in total assets, $617.97 million in total
liabilities and a $16.74 million total stockholders' deficiency.
"Horizon Lines recorded a 6.1% decline in fourth-quarter container
volume, which was partially offset by a 3.1% rise in container
revenue, net of fuel surcharges, compared with the same period a
year ago," said Sam Woodward, president and chief executive
officer. "A volume decline in Puerto Rico drove the overall
decrease in revenue and revenue loads."
A copy of the press release is available for free at:
http://is.gd/jdSoDA
About Horizon Lines
Charlotte, N.C.-based Horizon Lines, Inc. (NYSE: HRZ) is the
nation's leading domestic ocean shipping and integrated logistics
company. The Company owns or leases a fleet of 20 U.S.-flag
containerships and operates five port terminals linking the
continental United States with Alaska, Hawaii, Guam, Micronesia
and Puerto Rico. The Company provides express trans-Pacific
service between the U.S. West Coast and the ports of Ningbo and
Shanghai in China, manages a domestic and overseas service partner
network and provides integrated, reliable and cost competitive
logistics solutions.
Refinancing
The Company was not in compliance with the maximum senior secured
leverage ratio and the minimum interest coverage ratio under its
Senior Credit Facility at the close of its third fiscal quarter
ended Sept. 25, 2011. Non-compliance with these financial
covenants constituted an event of default, which could have
resulted in acceleration of the maturity. None of the
indebtedness under the Senior Credit Facility or Notes was
accelerated prior to the completion of a comprehensive refinancing
on Oct. 5, 2011.
The Senior Credit Facility and 99.3% of the 4.25% Convertible
Senior Notes were repaid as part of the refinancing. In addition,
as a result of the completion of the refinancing, the short-term
obligations under the Senior Credit Facility, the Notes and the
Bridge Loan have been classified as long-term debt.
As a result of the efforts to refinance the Company's debt and the
2011 amendments to the Senior Credit Facility, the Company paid
$17.3 million in financing costs and recorded a loss on
modification of debt of $0.6 million during 2011.
* * *
In June 2012, Moody's Investors Service affirmed Horizon Lines,
Inc.'s Corporate Family Rating (CFR) and Probability of Default
Rating ("PDR") at Caa2 and removed the LD ("Limited Default")
designation from the rating in recognition of the conversion to
equity of the $228 million of Series A and Series B Convertible
Senior Secured notes due in October 2017 ("Notes").
Moody's said the affirmation of the Corporate Family and
Probability of Default ratings considers that total debt has been
reduced by the conversion of the Notes, but also recognizes the
significant operating challenges that the company continues to
face.
HORIZON PHARMA: Incurs $87.8-Mil. Net Loss in 2012
--------------------------------------------------
Horizon Pharma, Inc., filed on March 18, 2013, its annual report
on Form 10-K for the year ended Dec. 31, 2012.
PricewaterhouseCoopers LLP, in Chicago, Illinois, expressed
substantial doubt about Horizon Pharma's ability to continue as a
going concern. The Company's independent auditors noted that the
Company has a limited commercial operating history and may not be
able to comply with certain debt covenants.
The Company reported a net loss of $87.8 million on $19.6 million
of net sales in 2012, compared with a net loss of $113.3 million
on $6.9 million of net sales in 2011.
The Company's balance sheet at Dec. 31, 2012, showed
$194.0 million in total assets, $88.0 million in total
liabilities, and stockholders' equity of $106.0 million.
A copy of the Form 10-K is available at http://is.gd/sZJzJb
Deerfield, Illinois-based Horizon Pharma, Inc. (NASDAQ: HZNP) is a
specialty pharmaceutical company that has developed and is
commercializing DUEXIS and RAYOS/LODOTRA, both of which target
unmet therapeutic needs in arthritis, pain and inflammatory
diseases.
HOST HOTELS: Fitch Rates $400MM Series D Senior Notes 'BB+'
-----------------------------------------------------------
Fitch Ratings assigns a credit rating of 'BB+' to the $400 million
3.75% series D senior notes due 2023 issued by Host Hotels &
Resorts, L.P., the operating partnership of Host Hotels & Resorts,
Inc. (NYSE: HST, collectively, Host).
The $396 million of estimated net proceeds from the issuance and
cash on hand will be used to redeem all of the outstanding $400
million 9% series T notes due 2017 at a cost $418 million
including pre-payment penalties. Fitch views the transaction as a
credit positive as it will lower interest costs and extend
duration.
The following covenants have changed when compared with Host's
previous senior notes covenants:
-- Interest coverage of at least 1.5x from 2.0x previously;
-- Secured debt not to exceed 40% compared with 45% previously;
-- Maintenance of total unencumbered assets to outstanding
unsecured debt of 150% compared with 125% previously.
The total debt covenant (total debt not to exceed 65% of total
assets) has not changed. However, the covenant revisions align
more closely with other investment grade REIT issuers. These
covenants do not restrict Host's financial flexibility.
Fitch currently rates Host as follows:
Host Hotels & Resorts, Inc.
-- Issuer Default Rating (IDR) 'BB+'.
Host Hotels & Resorts, L.P.
-- IDR 'BB+';
-- Unsecured revolving credit facility 'BB+';
-- Senior unsecured notes 'BB+';
-- Senior unsecured exchangeable notes 'BB+'.
The Rating Outlook is Stable.
Key Rating Drivers
The 'BB+' IDR reflects that Host's credit metrics will remain
appropriate for the rating through the lodging cycle. The ratings
also incorporate Host's high-quality portfolio of geographically
diversified upper tier hotel properties, its large and liquid
unencumbered asset pool and the company's progress and commitment
to sustaining lower leverage.
Positive Hotel Industry Outlook
Fitch has a positive view towards U.S. lodging industry
fundamentals owing to healthy demand from corporate transient and
inbound international visitation trends. Combined with limited new
supply, the increase in demand has lifted occupancy rates to
levels that support pricing flexibility. Fitch's base case
incorporates revenue per available room (RevPAR) for U.S. hotels
of 4.5% in 2013, which is at the low end of the 4%-6% range of
forecasts from the leading industry forecasting services.
Diversified Portfolio
Host maintains a high-quality, geographically diversified
portfolio of 118 consolidated luxury and upscale hotel properties
across the U.S. including 15 international hotels located in,
Australia, Brazil, Canada, Chile, Mexico, and New Zealand. The
company's portfolio provides significant financial flexibility and
geographically diverse cash flows, which Fitch views positively.
Expectations for Sustained Lower Leverage
Host has reduced its leverage from its down cycle peak of 5.5x to
4.4x for the trailing 12 month period ending Dec. 31, 2012. Fitch
defines leverage as net debt to recurring operating EBITDA,
including cash distributions from joint ventures. Fitch's base
case scenario projects Host's leverage to decrease to 3.7x in 2013
and 3.2x in 2014.
Large and Liquid Unencumbered Asset Pool
Along with having $737 million (or 73.7%) of availability under
its revolving credit facility and $417 million of cash on its
balance sheet at Dec. 31, 2012, Host's large unencumbered asset
pool provides an excellent source of contingent liquidity. The
company's unencumbered assets to unsecured debt (UA/UD) ratio
ended 2012 at 385%. Host's unencumbered asset profile has several
attractive features that should enhance their appeal as
collateral. The company's hotels are principally located in key
'gateway' markets that balance sheet lenders tend to favor.
Moreover, its hotels are generally aligned with the strongest
brands in the industry. Finally, Host owns some of the largest and
most valuable hotels in the U.S., which should allow it to raise
secured debt capital quickly and in size, if needed.
Fitch projects that Host's fixed charge coverage ratio, which
declined to 1.7x in 2009 from 2.6x in 2008 and rose to 2.2x in
2012, to improve to 3.2x in 2013 and 3.7x in 2014. In a more
adverse case than anticipated by Fitch, coverage could decline to
2.0x over the next 12-to-24 months, which would be commensurate
with a rating lower than 'BB+'. Fitch defines fixed charge
coverage as recurring operating EBITDA less renewal and
replacement capital expenditures, divided by cash interest expense
and capitalized interest.
Industry Cyclicality Reduces Cash Flow Stability
The cyclical nature of the hotel industry is Fitch's primary
credit concern related to Host. Hotels re-price their inventory
daily and, therefore, have the shortest lease terms and least
stable cash flows of any commercial property type. Economic
cycles, as well as exogenous events (i.e. acts of terrorism), have
historically caused material declines in revenues and
profitability for hotels.
The Stable Outlook centers on Fitch's expectation that Host's
credit profile will remain appropriate for the 'BB+' rating
through the economic cycles, barring any significant changes in
the company's capital structure plans. The Stable Outlook also
reflects the quality of Host's portfolio and unencumbered asset
coverage that provides good downside protection to bondholders.
Host has access to various sources of capital and maintains a
solid liquidity profile, moderate leverage, consistent coverage of
fixed charges, and solid unencumbered asset coverage.
Rating Sensitivities
The following factors may result in positive momentum in the
ratings and/or Rating Outlook:
-- Achieving leverage of roughly 3x, which Fitch views as
adequate cushion to maintain leverage below 5x during a
lodging cycle downturn.
-- Host maintaining a significant pool of unencumbered assets;
-- Sustaining fixed charge coverage above roughly 3x, which
Fitch views as adequate cushion to maintain coverage above 2x
during a lodging cycle downturn.
The following factors may result in negative momentum on the
ratings and/or Rating Outlook:
-- Fitch's expectation for leverage to sustain above 5.0x;
-- Fitch's expectation for fixed charge coverage sustaining
below 1.5x.
HOWREY LLP: Trustee Slams Latest Bid to Sue Equity Holders
----------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that the trustee
overseeing Howrey LLP's liquidation on Thursday urged a California
bankruptcy court to reject an unsecured creditor's latest effort
to hold the firm's former equity security holders accountable for
its downfall by seeking permission to launch a class action in
federal district court.
According to the report, trustee Allan B. Diamond of Diamond
McCarthy LLP slammed Howrey Claims LLC's bid to modify the
automatic stay protecting Howrey from litigation while it is in
bankruptcy, saying it is nothing more than a thinly veiled effort
to get around the court's order.
The BLaw360 also reported that the Trustee on Wednesday agreed to
hold off on launching litigation against a group of former
partners until September in the hopes that they can settle their
disputes before they end up in court. The report said the Trustee
entered two court filings indicating that he is prepared to fire
certain claims against the partners but that he would wait
approximately six months to sue them.
About Howrey LLP
Three creditors filed an involuntary Chapter 7 petition (Bankr.
N.D. Calif. Case No. 11-31376) on April 11, 2011, against the
remnants of the Washington-based law firm Howrey LLP. The filing
was in San Francisco, where the firm had an office. The firm
previously was known as Howrey & Simon and Howrey Simon Arnold &
White LLP. The firm at one time had more than 700 lawyers in 17
offices. The partners voted to dissolve in March 2011.
The firm specialized in antitrust and intellectual-property
matters. The three creditors filing the involuntary petition
together have $36,600 in claims, according to their petition.
The involuntary chapter 7 petition was converted to a chapter 11
case in June 2011 at the request of the firm. In its schedules
filed in July, the Debtor disclosed assets of $138.7 million and
liabilities of $107.0 million.
Representing Citibank, the firm's largest creditor, is Kelley
Cornish, Esq., a partner at Paul, Weiss, Rifkind, Wharton &
Garrison. Representing Howrey is H. Jason Gold, Esq., a partner
at Wiley Rein.
The Official Committee of Unsecured Creditors is represented in
the case by Bradford F. Englander, Esq., at Whiteford, Taylor And
Preston LLP.
In September 2011, Citibank sought conversion of the Debtor's case
to Chapter 7 or, in the alternative, appointment of a Chapter 11
Trustee. The Court entered an order appointing a Chapter 11
Trustee. In October 2011, Allan B. Diamond was named as Trustee.
HRK HOLDINGS: Has $1.2-Mil. in Add'l Financing From Regions Bank
----------------------------------------------------------------
The Hon. K. Rodney May of the U.S. Bankruptcy Court for the Middle
District of Florida, authorized HRK Holdings, LLC, and HRK
Industries, LLC to:
-- borrow on a secured basis from Regions Bank the additional
amount of $1,177,276 under a Second DIP Facility; and
-- execute modifications to the Second DIP Loan Documents
executed in connection with the Second Financing Orders;
The Debtors' additional financing and indebtedness will be secured
by the same first liens on and security interests on all assets of
the Debtors granted in the Second Financing Orders, other
than Avoidance Actions. The Debtor will also grant Regions a
superpriority administrative expense claim.
The Second Financing Orders, among other things, authorized the
Debtors to borrow up to $3,480,139 from Regions pursuant to the
Second DIP Loan Documents and granted Regions senior liens to
secure the advances.
The Debtors would use the loan to supplement revenues to fund
operating and costs of administration of the Chapter 11 cases.
About HRK Holdings
Based in Palmetto, Florida, HRK Holdings LLC owns roughly 675
contiguous acres of real property in Manatee County, Florida.
Roughly 350 acres of the property accommodates a phosphogypsum
stack system, called Gypstaks, a portion of which was used as an
alternate disposal area for the management of dredge materials
pursuant to a contract with Port Manatee and as authorized under
an administrative agreement with the Florida Department of
Environmental Protection. The remaining acres of usable land are
either leased to various tenants or available for sale. HRK
Industries holds various contracts and leases associated with the
Debtors' property.
HRK Holdings and HRK Industries LLC filed for Chapter 11
protection (Bankr. M.D. Fla. Case Nos. 12-09868 and 12-09869) on
June 27, 2012. Judge K. Rodney May oversees the case. Barbara A.
Hart, Esq., at Stichter, Riedel, Blain & Prosser, P.A., represents
the Debtors.
HRK Holdings disclosed $33,366,529 in assets and $26,092,559
in liabilities in its revised schedules.
According to the Debtors, the bankruptcy filing was necessitated
by the immediate need to sell a portion of the remaining property
to create liquidity for (a) funding the urgent management of the
site-related environmental concerns; the benefit of creditors;
funding a litigation filed by the Debtors; and funding of expenses
related to additional sales of the remaining property.
HUDSON HEALTHCARE: Trustee Blames Losses on Exec Negligence, Fraud
------------------------------------------------------------------
Linda Chiem of BankruptcyLaw360 reported that the liquidating
trustee for the former operator of Hoboken University Medical
Center accused its top brass and accounting firms of mismanaging
it into bankruptcy and orchestrating fraudulent transfers that
deprived creditors of recovering money they were owed, according
to a New Jersey federal court suit filed Wednesday.
The report related that Bernard A. Katz, the liquidating trustee
for the nonprofit Hudson Healthcare Inc., which operated Hoboken's
sole acute-care hospital from 2007 to 2011, claims Hudson's CEO
Harvey Holzberg, Chief Financial Officer Ron DiVito, board of
directors and its accounting firms connived to make fraudulent
transfers prior to the filing of the medical center.
About Hudson Healthcare
Hudson Healthcare Inc. is a non-for-profit corporation formed
under the laws of the State of New Jersey. Until the sale of
Hoboken University Medical Center by the Hoboken Municipal
Hospital Authority, the Debtor owned and managed the day-today
operations of the Hospital on the Authority's behalf pursuant to a
Manager Agreement dated Feb. 1, 2007. Other than certain contract
rights, other intangibles, and approximately 12 vehicles, the
Debtor did not own any Hospital assets.
Hudson Healthcare filed for Chapter 11 protection (Bankr. D. N.J.
Case No. 11-33014) in Newark on Aug. 1, 2011, estimating assets
and debt of less than $50 million. Affiliate Hoboken Municipal
Hospital Authority also sought Chapter 11 protection.
Attorneys at Trenk, DiPasquale, Webster, Della Fera & Sodono,
P.C., in West Orange, N.J., serve as counsel to the Debtor.
Daniel T. McMurray, the patient care ombudsman, has tapped
Neubert, Pepe & Monteith, P.C., as his counsel effective Aug. 25,
2011. The Official Committee of Unsecured Creditors of Hudson
Healthcare retained Sills Cummis & Gross P.C., in Newark, N.J., as
its counsel, nunc pro tunc to Aug. 12, 2011. JH Cohn LLP serves
as Financial Advisor to the Committee. Epiq Bankruptcy Solutions,
LLC, is the Claims and Noticing Agent and Solicitation Agent.
INDIANAPOLIS DOWNS: Plan Confirmed; Reconsideration Sought
----------------------------------------------------------
BankruptcyData reported that the U.S. Bankruptcy Court approved
Indianapolis Downs' Second Amended Joint Plan of Reorganization.
According to the Debtors, "The Plan was structured to permit the
Debtors to either (a) sell substantially all of their Assets at a
level of Consideration that would provide substantial recovery for
the Debtors' constituents or (b) if such level of Consideration
was not achieved, to effect a recapitalization that would
deleverage the Debtors' balance sheet and restructure their
remaining debt. After almost eighteen months in chapter 11, an
aggressive marketing process, and exhaustive consideration of all
alternatives, there can be no doubt that confirmation of the Plan
and approval of the proposed sale is the best alternative
available for the Debtors. Accordingly, the Debtors believe that
the Plan provides the best means for exiting chapter 11," the
report related, citing court papers.
In response, the Oliver Parties, a group that consists of chairman
and C.E.O., Ross Mangano, and several family trusts that
collectively hold approximately $40 million of unsecured notes
filed with the Court an emergency motion to reconsider and/or
clarification of Court's confirming the Plan and its provision
waiving the 14-day stay, BankruptcyData further related.
The Oliver parties, according to the report, state, "Not only does
the waiver blindside the Oliver Parties, but it causes irreparable
injury to them. Without the automatic 14 3020(e), the Oliver
Parties cannot effectively seek to stay the Confirmation Order
pending resolution of their appeal rights. As a result, the
waiver risks equitably mooting the Oliver Parties' appeal rights
without a showing that it is necessary or justified. The Court
should thus reinstate the 14- day stay required by Bankruptcy Rule
3020(e)."
About Indianapolis Downs
Indianapolis Downs LLC operates Indiana Live --
http://www.indianalivecasino.com/-- a combined race track and
casino at a state-of-the-art 283 acre Shelbyville, Indiana site.
It also operates two satellite wagering facilities in Evansville
and Clarksville, Indiana. Total revenue for 2010 was $270
million, representing an 8.7% increase in 2009. The casino
captured 53% of the Indianapolis market share.
In July 2001, Indianapolis Downs was granted a permit to conduct a
horse track operation in Shelvyville, Indiana, and started
operating the track in 2002. It was granted permission to operate
the casino at the racetrack operation in May 2007. The casino
began operations in July 2010.
Indianapolis Downs and subsidiary, Indianapolis Downs Capital
Corp., sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
11-11046) in Wilmington, Delaware, on April 7, 2011. Indianapolis
Downs estimated $500 million to $1 billion in assets and up to
$500 million in debt as of the Chapter 11 filing. According to a
court filing, the Debtor owes $98,125,000 on a first lien debt. It
also owes $375 million on secured notes and $72.6 million on
subordinated notes.
Matthew L. Hinker, Esq., Scott D. Cousins, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP in Wilmington,
Delaware, have been tapped as counsel to the Debtors. Christopher
A. Ward, Esq., at Polsinelli Shughart PC, in Wilmington, Delaware,
is the conflicts counsel. Lazard Freres & Co. LLC is the
investment banker. Bose Mckinney & Evans LLP and Bose Public
Affairs Group LLC serve as special counsel. Kobi Partners, LLC,
is the restructuring services provider. Epiq Bankruptcy
Solutions is the claims and notice agent.
David W. Carickhoff, Esq., at Blank Rome LLP; and Scott L.
Alberino, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
Washington, DC, represent the Ad Hoc Second Lien Committee.
Thomas M. Horan, Esq., at Womble Carlyle Sandridge & Rice, LLP;
and Brian L. Shaw, Esq., at Shaw Gussis Fishman Wolfson & Towbin
LLC, represent the so-called Oliver Parties. The Oliver Parties
consist of Ross J. Mangano, both individually and as the trustee
of the Jane C. Warriner Trust dated February 26, 1971, the J.
Oliver Cunningham Trust dated February 26, 1971, and the Anne C.
McClure Trust dated February 26, 1971, Troon & Co., John C.
Warriner, Oliver Estate, LLC, and Oliver Racing, LLC.
Matthew Lunn, Esq., at Young Conaway Stargatt & Taylor, LLP; and
Kristopher Hansen, Esq., Stroock & Stroock & Lavan, represent
Fortress Investment.
INSPIRATION BIOPHARMACEUTICALS: Sale of Hemophilia Completed
------------------------------------------------------------
Ipsen and Inspiration Biopharmaceuticals Inc. on March 21
announced the closing of the sale of its lead hemophilia program,
OBI-1 to Baxter International Inc., the global leader in
hemophilia. The transaction was announced on January 24, 2013.
Ipsen and Inspiration jointly agreed to sell their respective
rights to OBI-1 as part of the transaction.
Baxter acquired worldwide rights to OBI-1, a recombinant porcine
factor VIII in development for the treatment of congenital
hemophilia A with inhibitors and acquired hemophilia A, as well as
Ipsen's manufacturing facility for OBI-1 in Milford,
Massachusetts. The Ipsen employees working on the development and
manufacturing of OBI-1 are offered employment by Baxter.
Baxter has agreed to pay $50 million upfront, up to $135 million
in potential additional development and sales milestones as well
as tiered net sales payments ranging from 12.5% to 17.5% of OBI-1
global net sales. OBI-1 is currently in a pivotal trial for the
treatment of individuals with acquired hemophilia A.
This closing completes the joint sale process pursued by
Inspiration and Ipsen shortly after Inspiration filed for
protection under Chapter 11 of the U.S. Bankruptcy Code on October
30, 2012. Ipsen provided Inspiration with a $18.4 million Debtor-
in-Possession (DIP) financing to fund Inspiration's operations and
the sale process.
On February 19, 2013 Cangene Corporation acquired worldwide rights
to IB1001 (recombinant FIX). Cangene has agreed to pay an upfront
payment of $5.9 million, sales milestones totaling $50 million and
annual net sales payments tiered up to a double-digit percentage
of global net sales.
As Inspiration's only senior secured creditor and as the owner of
non-Inspiration assets that will be included in the sale of both
OBI-1 and IB1001, Ipsen will receive at least 60% of the upfront
payments. Over and above these upfront amounts, Ipsen will
receive 80% of all payments up to a present value of $304 million
and 50% of all proceeds thereafter.
On the transaction, Evercore Partners served as joint financial
advisor to Inspiration and Ipsen; Lazard and Banque Hottinguer
served as financial advisors to Ipsen.
About the partnership agreement between Inspiration and Ipsen and
the product portfolio
In January 2010, Inspiration entered into a strategic agreement
with Ipsen, leveraging the combined expertise and resources of the
two companies, to develop a broad portfolio of hemophilia products
and two products in phase III. IB1001, an investigational
intravenous recombinant factor IX (rFIX) therapy for the treatment
and prevention of bleeding episodes in people with hemophilia B
and OBI-1 an investigational intravenous recombinant porcine
factor VIII (rpFVIII) therapy for the treatment of patients with
i) acquired hemophilia A and ii) congenital hemophilia A who have
developed inhibitors against human FVIII.
In August 2011, Ipsen and Inspiration announced the extension of
their agreement to create a hemophilia business unit structure
that will act as the exclusive sales organization for all
hemophilia products commercialized under the Inspiration brand in
Europe.
In July 2012 Inspiration announced that IB1001 was placed on
clinical hold by the Food and Drug Administration (FDA).
On August 21, 2012, Ipsen and Inspiration renegotiated their 2010
partnership. This agreement aimed to establish an effective
structure whereby Ipsen gained commercial rights in key
territories. Inspiration remains responsible for the world-wide
development of OBI-1 and IB1001. Ipsen paid a bridging facility
for an amount of $30 million providing both Inspiration with time
to secure independent third party financing and Ipsen with time to
assess potential ways forward.
On August 31, 2012, Ipsen paid Inspiration $7.5 million and
received a warrant for 15% of Inspiration's equity.
Ipsen had agreed to pay Inspiration an additional $12.5 million if
Inspiration had raised third party financing by the contractual
deadline of 30 September 2012. Inspiration did not manage to
raise external funding by this contractual deadline.
On October 30, 2012, Inspiration commenced a voluntary
reorganization case pursuant to Chapter 11's provisions of the
United States Bankruptcy Code with the objective of leading a
joint marketing and sales process.
On January 24, 2013, Ipsen and Inspiration announced that they had
entered into an Asset Purchase Agreement for the sale of OBI-1 to
Baxter subject to closing conditions, including Bankruptcy Court
and antitrust approvals.
On February 20, 2013, Ipsen and Inspiration announced the closing
of the sale of IB1001 to Cangene.
John P. Butler, Chief Executive Officer of Inspiration commented,
"Inspiration was founded by the families of boys with hemophilia
with a vision to bring new treatment options to people living with
this condition. The completion of the sale of OBI-1 to Baxter,
following the IB1001 sale to Cangene, fulfills this vision. I am
confident that Baxter is the right steward to bring this important
product to patients in need."
Overall the total aggregate consideration to be received from
Baxter and Cangene for Inspiration's assets through these two
transactions may exceed $1 billion.
Inspiration will provide transition services to Baxter and Cangene
for a three-month transition period. Some employees have accepted
offers of employment from Baxter or Cangene, which employment will
commence following the transition service period. Inspiration
will wind down its operations following this transition period.
Evercore Partners served as joint financial advisor to Inspiration
and Ipsen on these two transactions. Ropes & Gray served as legal
advisor to Inspiration on the transaction. Murphy & King is
Inspiration's bankruptcy counsel and FTI Consulting, Inc. is Chief
Restructuring Officer for Inspiration.
About Ipsen
Ipsen -- http://www.ipsen.com-- is a global specialty-driven
pharmaceutical company with total sales exceeding EUR1.2 billion
in 2012. Ipsen's ambition is to become a leader in specialty
healthcare solutions for targeted debilitating diseases. Its
development strategy is supported by 3 franchises: neurology /
Dysport(R), endocrinology / Somatuline(R) and uro-oncology /
Decapeptyl(R). Moreover, the Group has an active policy of
partnerships. Ipsen's R&D is focused on its innovative and
differentiated technological platforms, peptides and toxins. In
2012, R&D expenditure totaled close to EUR250 million,
representing more than 20% of Group sales. The Group has close to
4,900 employees worldwide.
About Inspiration Biopharmaceuticals
Inspiration Biopharmaceuticals Inc. develops recombinant blood
coagulation factor products for the treatment of hemophilia.
Inspiration, based in Cambridge, Massachusetts, has two products
in what the company calls "advanced clinical development." Two
other products are in "pre-clinical development." None of the
products can be marketed as yet.
Inspiration filed for voluntary Chapter 11 reorganization (Bankr.
D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston.
Bankruptcy Judge William C. Hillman oversees the case. Mark
Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the
Debtor's Chief Restructuring Officers. The Debtor is represented
by Harold B. Murphy of Murphy & King.
The petition shows assets and debt both exceed $100 million.
Assets include patents, trademarks and the products in
development. Liabilities include $195 million owing to Ipsen
Pharma SAS, which is also a 15.5% shareholder. Ipsen --
http://www.ipsen.com/-- is also owed $19.4 million in unsecured
debt. There is another $12 million in unsecured claims. Ipsen is
pledged to provide $18.3 million in financing. The Debtor
disclosed $20,383,300 in assets and $241,049,859 in liabilities.
Ipsen is represented in the case by J. Eric Ivester, Esq., at
Skadden Arps.
The Official Committee of Unsecured Creditors tapped Jeffrey D.
Sternklar and Duane Morris LLP as its counsel, and The Hawthorne
Consulting Group, LLC as its financial advisor.
INSPIREMD INC: Receives CE Mark Approval for Carotid EPS
--------------------------------------------------------
InspireMD, Inc., received CE mark approval for its self-expanding
Nitinol carotid EPS. This carotid embolic protection stent is
based on the proprietary MicroNetTM mesh protection platform
technology used to treat heart attack patients with InspireMD's
commercially available coronary EPS stents, MGuardTM and MGuard
PrimeTM.
When treating carotid arterial disease, close to half of Carotid
Artery Stenting (CAS) procedures cause distal embolic events that
may lead to stroke within 30 days. The InspireMD Carotid Embolic
Protection Stent (EPS) is wrapped with a MicroNetTM mesh to
prevent embolic events during and post CAS procedure. The
MicroNetTM is designed to hold plaque and thrombus in place
against the wall of the blocked artery, preventing debris from
falling into the bloodstream and causing a potentially fatal
downstream blockage or stroke.
In coronary procedures, InspireMD's EPS technology has already
shown improvements through the MASTER trial findings that revealed
a statistically and clinically significant acute advantage of
MGuard EPS with regard to ST segment resolution. As a result,
MGuard EPS may hold the potential to lower the incidence of
adverse events and prolong survival of heart attack victims. The
new InspireMD Carotid EPS stent will be available in a matrix of
sizes ranging from small diameters of 5x20mm to large diameters up
to 10x60mm for large carotid arteries.
Commenting on the approvals, InspireMD's President and CEO, Alan
Milinazzo, said, "The CE mark approval for our MGuard carotid
system is a major milestone for the Company and is further
validation of the Micronet technology. We look forward to
accelerating our clinical development program with our carotid
system. The CE mark should enhance our partnership strategy in
the near term."
About InspireMD
InspireMD, Inc., was organized in the State of Delaware on
Feb. 29, 2008, as Saguaro Resources, Inc., to engage in the
acquisition, exploration and development of natural resource
properties. On March 28, 2011, the Company changed its name from
"Saguaro Resources, Inc." to "InspireMD, Inc."
Headquartered in Tel Aviv, Israel, InspireMD, Inc., is a medical
device company focusing on the development and commercialization
of its proprietary stent platform technology, Mguard. MGuard
provides embolic protection in stenting procedures by placing a
micron mesh sleeve over a stent. The Company's initial products
are marketed for use mainly in patients with acute coronary
syndromes, notably acute myocardial infarction (heart attack) and
saphenous vein graft coronary interventions (bypass surgery).
The Company's balance sheet at Sept. 30, 2012, showed
$13.6 million in total assets, $14.4 million in total liabilities,
and a stockholders' deficit of $756,000.
InspireMD reported a net loss of US$17.59 million on US$5.35
million of revenue for the year ended June 30, 2012, compared with
a net loss of US$6.17 million on US$4.67 million of revenue during
the prior year.
Kesselman & Kesselman, in Tel Aviv, Israel, issued a "going
concern" qualification on the consolidated financial statements
for the year ended June 30, 2012. The independent auditors noted
that the Company has had recurring losses, negative cash flows
from operating activities and has significant future commitments
that raise substantial doubt about its ability to continue as a
going concern.
The Company said the following statement in its quarterly report
for the period ended Dec. 31, 2012:
"The Company has had recurring losses and negative cash flows from
operating activities and has significant future commitments. For
the six months ended December 31, 2012, the Company had losses of
approximately $9.4 million and negative cash flows from operating
activities of approximately $5.8 million. The Company's
management believes that its financial resources as of December
31, 2012 should enable it to continue funding the negative cash
flows from operating activities through the three months ended
September 30, 2013. Furthermore, commencing October 2013, the
Company's senior secured convertible debentures (the "2012
Convertible Debentures") are subject to a non-contingent
redemption option that could require the Company to make a payment
of $13.3 million, including accrued interest. Since the Company
expects to continue incurring negative cash flows from operations
and in light of the cash requirement in connection with the 2012
Convertible Debentures, there is substantial doubt about the
Company's ability to continue operating as a going concern. These
financial statements include no adjustments of the values of
assets and liabilities and the classification thereof, if any,
that will apply if the Company is unable to continue operating as
a going concern."
The Company's balance sheet at Dec. 31, 2012, showed US$11.59
million in total assets, US$11.39 million in total liabilities and
a US$204,000 in total equity.
INTELLIPHARMACEUTICS INT'L: Keppra Accepted by FDA for Filing
-------------------------------------------------------------
Intellipharmaceutics International Inc. announced an update on its
generic versions of the marketed drugs Keppra XR(R) and
Pristiq(R).
In September 2012, the Company announced that it had filed with
the U.S. Food and Drug Administration two Abbreviated New Drug
Applications, for generic versions of the marketed drugs Keppra
XR(R) (levetiracetam extended-release tablets), an antiepileptic
product for the treatment of partial onset seizures in patients
with epilepsy and Pristiq(R) (desvenlafaxine extended-release
tablets), a product for the treatment of depression.
The Company said the FDA has accepted for filing the Company's
ANDA for generic Keppra XR(R).
Based on the FDA's preliminary review and comments on the
Company's ANDA for generic Pristiq(R), the Company plans to repeat
one of three bioequivalence studies for the product candidate.
The Company will amend its existing application for generic
Pristiq(R) to include the new study upon its successful
completion.
Seven ANDAs in total have now been accepted by the FDA for review.
The Company is proceeding with development of all its product
candidates, including several other ANDA and New Drug Application
product candidates that have been previously disclosed and
described by the Company.
About Intellipharmaceutics International
Intellipharmaceutics International Inc. is a pharmaceutical
company specializing in the research, development and manufacture
of novel and generic controlled-release and targeted-release oral
solid dosage drugs.
Deloitte LLP, in Toronto, Canada expressed substantial doubt
about Intellipharmaceutics' ability to continue as a going
concern. The independent auditors noted that of the Company's
recurring losses from operations and accumulated deficit.
The Company reported a net loss of US$6.14 million on US$107,091
of research and development revenue for fiscal 2012, compared with
a net loss of US$4.88 million on US$501,814 of research and
development revenue for fiscal 2011.
The Company's balance sheet at Nov. 30, 2012, showed
US$2.47 million in total assets, US$4.24 million in total
liabilities, and a stockholders' deficit of US$1.77 million.
ISTAR FINANCIAL: Has 3.5MM Shares Underwriting Pact with Barclays
-----------------------------------------------------------------
iStar Financial Inc. entered into an underwriting agreement, dated
March 12, 2013, by and among the Company and Barclays Capital Inc.
and the other several underwriters named therein with respect to
the issuance and sale by the Company of 3,500,000 shares of its
4.50% Series J Cumulative Convertible Perpetual Preferred Stock.
The Series J Preferred Stock (including the additional 500,000
option shares) was issued and delivered to the underwriters on
March 18, 2013. The Company intends to use the net proceeds from
the issuance and sale of the Series J Preferred Stock for new
investment activities and general corporate purposes.
On March 15, 2013, the Company executed Articles Supplementary
designating the rights and preferences of the Series J Preferred
Stock. Each share of the Series J Preferred Stock has a
liquidation preference of $50.00 per share and is convertible, at
the holder's option at any time, initially into 3.9087 shares of
the Company's common stock (equal to an initial conversion price
of approximately $12.79 per share), subject to specified
adjustments. If a fundamental change occurs as specified in the
Articles Supplementary, the Company may be required to pay a make-
whole premium on the Series J Preferred Stock converted in
connection with the fundamental change.
The Company may not redeem the Series J Preferred Stock prior to
March 15, 2018. On or after March 15, 2018, the Company may, at
its option, redeem the Series J Preferred Stock, in whole or in
part, at any time and from time to time, for cash at a redemption
price equal to 100% of the liquidation preference of $50.00 per
share, plus accrued and unpaid dividends, if any, to the
redemption date.
The Series J Preferred Stock was registered with the Securities
and Exchange Commission pursuant to the Company's shelf
registration statement on Form S-3.
A copy of the Underwriting Agreement is available at:
http://is.gd/rPvaoJ
About iStar Financial
New York-based iStar Financial Inc. (NYSE: SFI) provides custom-
tailored investment capital to high-end private and corporate
owners of real estate, including senior and mezzanine real estate
debt, senior and mezzanine corporate capital, as well as corporate
net lease financing and equity. The Company, which is taxed as a
real estate investment trust, provides innovative and value added
financing solutions to its customers.
The Company reported a net loss of $25.69 million in 2011,
compared with net income of $80.20 million in 2010.
iStar Financial's balance sheet at Sept. 30, 2012, showed $6.94
billion in total assets, $5.52 billion in total liabilities,
$14.20 million in redeemable noncontrolling interests, and $1.40
billion in total equity.
* * *
In March 2012, Fitch affirmed the company's 'B-' issuer default
rating. The IDR affirmation is based on a manageable debt
maturity profile of the company, pro forma for the recently-
consummated secured financing that extends certain of the
company's debt maturities, relieving the overhang of significant
unsecured debt maturities in 2012 and 2013. While this 2012
financing does not reduce the amount of total debt outstanding,
the company's debt maturity profile is more manageable over the
next two years, with only 48% of debt maturing pro forma, down
from 61%. Given the mild improvement in commercial real estate
fundamentals and value stabilization, the company's loan and real
estate owned portfolio performance will likely improve going
forward, which should increase the company's ability to repay
upcoming indebtedness.
As reported by the TCR on Oct. 5, 2012, Standard & Poor's Ratings
Services affirmed its 'B+' long-term issuer credit rating on iStar
Financial Inc.
In October 2012, Moody's Investors Service upgraded the corporate
family rating to B2 from B3. The current rating reflects the
REIT's success in extending near term debt maturities and
improving fundamentals in commercial real estate. The ratings on
the October 2012 senior secured credit facility takes into account
the asset coverage, the size and quality of the collateral pool,
and the term of facility.
ISTAR FINANCIAL: PointState Capital Has 6.5% Stake at March 5
-------------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, PointState Capital LP and Zachary J. Schreiber
disclosed that, as of March 5, 2013, they beneficially own
5,492,500 shares of common stock of iStar Financial Inc.
representing 6.5% of the shares outstanding. A copy of the filing
is available for free at http://is.gd/rZIgSy
About iStar Financial
New York-based iStar Financial Inc. (NYSE: SFI) provides custom-
tailored investment capital to high-end private and corporate
owners of real estate, including senior and mezzanine real estate
debt, senior and mezzanine corporate capital, as well as corporate
net lease financing and equity. The Company, which is taxed as a
real estate investment trust, provides innovative and value added
financing solutions to its customers.
The Company reported a net loss of $25.69 million in 2011,
compared with net income of $80.20 million in 2010. iStar
Financial's balance sheet at Sept. 30, 2012, showed $6.94
billion in total assets, $5.52 billion in total liabilities,
$14.20 million in redeemable noncontrolling interests, and $1.40
billion in total equity.
* * *
In March 2012, Fitch affirmed the company's 'B-' issuer default
rating. The IDR affirmation is based on a manageable debt
maturity profile of the company, pro forma for the recently-
consummated secured financing that extends certain of the
company's debt maturities, relieving the overhang of significant
unsecured debt maturities in 2012 and 2013. While this 2012
financing does not reduce the amount of total debt outstanding,
the company's debt maturity profile is more manageable over the
next two years, with only 48% of debt maturing pro forma, down
from 61%. Given the mild improvement in commercial real estate
fundamentals and value stabilization, the company's loan and real
estate owned portfolio performance will likely improve going
forward, which should increase the company's ability to repay
upcoming indebtedness.
As reported by the TCR on Oct. 5, 2012, Standard & Poor's Ratings
Services affirmed its 'B+' long-term issuer credit rating on iStar
Financial Inc.
In October 2012, Moody's Investors Service upgraded the corporate
family rating to B2 from B3. The current rating reflects the
REIT's success in extending near term debt maturities and
improving fundamentals in commercial real estate. The ratings on
the October 2012 senior secured credit facility takes into account
the asset coverage, the size and quality of the collateral pool,
and the term of facility.
IZEA INC: Converts $550,000 of Debt Into Common Stock
-----------------------------------------------------
IZEA, Inc., satisfied all of its obligations related to its
$550,000 February 2012 promissory note on Feb. 4, 2013. From
October 2012 through February 2013, the note holders or their
assignees converted the note into approximately 2.8 million shares
of IZEA's common stock at an average conversion price of $0.19 per
share.
"We are pleased to have this note converted in full," said Ted
Murphy, Founder & CEO of IZEA. "The elimination of this senior
secured debt enables the company to engage in other financing
options in the future."
Has 11.6MM Shares Under 2011 Plan
On Feb. 6, 2013, the board of directors and holders of a majority
of the outstanding shares of common stock of IZEA approved an
increase in the number of shares of common stock reserved for
issuance under its 2011 Equity Incentive Plan by 11,000,000 shares
to a new total of 11,613,715 shares. Other than the increase in
the number of shares reserved for issuance thereunder, no changes
were made to the 2011 Equity Incentive Plan, which is described in
IZEA's registration statement on Form S-1 (No. 333-181916),
effective Sept. 5, 2012. No awards have been made to date under
the Plan with respect to those new shares.
Amendments to Bylaws
On Feb. 6, 2013, the board of directors and holders of a majority
of the outstanding shares of common stock of IZEA approved an
increase in the number of authorized shares of common stock of
IZEA from 12,500,000 shares to 100,000,000 shares. IZEA amended
its Articles of Incorporation to effect the Share Increase by
filing a Certificate of Amendment with the Nevada Secretary of
State on Feb. 11, 2013.
About IZEA, Inc.
IZEA, Inc., headquartered in Orlando, Fla., believes it is a world
leader in social media sponsorships ("SMS"), a rapidly growing
segment within social media where a company compensates a social
media publisher to share sponsored content within their social
network. The Company accomplishes this by operating multiple
marketplaces that include its platforms SocialSpark,
SponsoredTweets and WeReward, as well as its legacy platforms
PayPerPost and InPostLinks.
The Company has incurred significant losses from operations since
inception and has an accumulated deficit of $20.9 million as of
June 30, 2012.
Cross, Fernandez & Riley, LLP, in Orlando, Florida, expressed
substantial doubt about IZEA's ability to continue as a going
concern, following the Company's results for the fiscal year ended
Dec. 31, 2011. The independent auditors noted that the Company
has incurred recurring operating losses and had an accumulated
deficit at Dec. 31, 2011, of $18.1 million.
J.C. PENNEY: Default Notice Withdrawal No Impact on 'B3' CFR
------------------------------------------------------------
Moody's Investors Service reports that J.C. Penney Company, Inc.'s
B3 Corporate Family Rating and negative outlook remain unchanged
following JCP's announcement that it has received a letter from
bondholders' counsel withdrawing and rescinding the Notice of
Default it received on January 29, 2013.
The principal methodology used in this rating 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.C. Penney Company, Inc. is one of the U.S.'s largest department
store operators with about 1,100 locations in the United States
and Puerto Rico. It also operates a website, www.jcp.com. Revenues
are about $13 billion.
JEFFERSON COUNTY: Mediation Required on Sewer Expense Appeal
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in Atlanta is trying to
bring Jefferson County, Alabama, and sewer bondholders together in
settlement.
The report relates that as a prelude to an appeal in upcoming
months, the appeals court is requiring the warring factions to
undergo mediation. The county is appealing a ruling made by the
bankruptcy judge in June limiting what the county can deduct from
sewer revenue before paying the remainder to bondholders. The
bankruptcy judge authorized a direct appeal to the Court of
Appeals, overstepping an intermediate appeal to a district judge.
The county's first brief on the appeal is due April 5.
The appeal is Jefferson County, Alabama v. Bank of Nova Scotia,
13-10348, U.S. Court of Appeals for the Eleventh Circuit
(Atlanta).
About Jefferson County
Jefferson County has its seat in Birmingham, Alabama. It has a
population of 660,000.
Jefferson County filed a bankruptcy petition under Chapter 9
(Bankr. N.D. Ala. Case No. 11-05736) on Nov. 9, 2011, after an
agreement among elected officials and investors to refinance
$3.1 billion in sewer bonds fell apart.
John S. Young Jr. LLC was appointed as receiver by Alabama Circuit
Court Judge Albert Johnson in September 2010.
Jefferson County's bankruptcy represents the largest municipal
debt adjustment of all time. The county said that long-term debt
is $4.23 billion, including about $3.1 billion in defaulted sewer
bonds where the debt holders can look only to the sewer system for
payment.
The county said it would use the bankruptcy court to put a value
on the sewer system, in the process fixing the amount bondholders
should be paid through Chapter 9.
Judge Thomas B. Bennett presides over the Chapter 9 case. Lawyers
at Bradley Arant Boult Cummings LLP and Klee, Tuchin, Bogdanoff &
Stern LLP, led by Kenneth Klee, represent the Debtor as counsel.
Kurtzman Carson Consultants LLC serves as claims and noticing
agent. Jefferson estimated more than $1 billion in assets. The
petition was signed by David Carrington, president.
The bankruptcy judge in January 2012 ruled that the state court-
appointed receiver for the sewer system largely lost control as a
result of the bankruptcy. Before deciding whether Jefferson County
is eligible for Chapter 9, the bankruptcy judge will allow the
Alabama Supreme Court to decide whether sewer warrants are the
equivalent of "funding or refunding bonds" required under state
law before a municipality can be in bankruptcy.
U.S. District Judge Thomas B. Bennett ruled in March 2012 that
Jefferson County is eligible under state law to pursue a debt
restructuring under Chapter 9. Holders of more than $3 billion in
defaulted sewer debt had challenged the county's right to be in
Chapter 9.
JEWISH COMMUNITY: Withdraws Motion to Hire Realtor
--------------------------------------------------
Catherine E. Youngman, Chapter 11 trustee for Jewish Community
Center of Greater Monmouth County, has withdrawn her motion for
authorization to employ the Capital Group of Newmark Real Estate
of New Jersey, LLC d/b/a Newmark Grubb Knight Frank as realtor.
The Chapter 11 Trustee filed the employment motion on Dec. 21,
2012, saying that employment of NGKF is necessary to market and
sell the debtor's real property located at 100 Grant Avenue, Ocean
Township, New Jersey. NGKF will seek a commission of 5% of the
gross sales price for services rendered. NGKF will also seek
reimbursement of expenses that it incurs in connection with the
proposed sale. NGKF estimated that those expenses will be
approximately $4,650 to $6,650. To the extent that NGKF is
required to expend additional sums to assist the Chapter 11
Trustee in securing and winterizing the property to be sold, it
will seek reimbursement for those costs as well. The Chapter 11
Trustee estimated that those expenses will not exceed
approximately $50,000.
On Dec. 30, 2012, the U.S. Trustee filed an objection and asked
the Court that the application to retain NGKF be denied. The U.S.
Trustee objected to certain terms set forth in the exclusive
listing agreement between NGKF and the Chapter 11 Trustee.
The U.S. Trustee said that the ELA includes various provisions
that should be revised or deleted, among them is Section 3(a)(v)
of the ELA that sets forth that NGKF will provide a team of
brokers and salespersons associated with or employed by NGKF.
"However, there is no explanation as to what the phrase
'associated with' means. If NGKF is utilizing other brokers or
realtors, such brokers or realtors should be required to file
separate retention applications in order to be employed," the U.S.
Trustee stated.
About Jewish Community Center
Headquartered in Deal Park, New Jersey, Jewish Community Center of
Greater Monmouth County, A Not-For-Profit Corporation --
http://jccmonmouth.org/-- offers services, programs, events,
activities, and facilities to Jewish families and individuals in
Monmouth County.
Jewish Community Center filed for Chapter 11 bankruptcy (Bankr. D.
N.J. Case No. 11-44738) on Dec. 5, 2011. Judge Michael B. Kaplan
presides over the case. Timothy P. Neumann, Esq., at Broege,
Neumann, Fischer & Shaver, serves as the Debtor's bankruptcy
counsel. In its petition, the Debtor estimated assets of
$10 million to $50 million and debts of $1 million to $10 million.
JOURNAL REGISTER: Approved to Sell Assets in Bankruptcy Court
-------------------------------------------------------------
Erik Larson, writing for Bloomberg News, reported that Journal
Register Co., a newspaper publisher in bankruptcy for a second
time, won court approval to sell its assets to an affiliate of its
current owner in exchange for $114 million in secured debt and
about $6 million in cash.
According to the report, U.S. Bankruptcy Judge Stuart Bernstein in
New York on Friday overruled a union, part of the Communications
Workers of America, that had objected the deal with the buyer,
21st CMH Acquisition Corp.
"In light of fact that the transaction will not close until after
the termination of the collective bargaining agreements, the court
overrules the unions' objection," Bernstein said in his written
ruling, the Bloomberg report cited. The union contract expires on
March 31.
The sale, according to Bloomberg, moves Journal Register a step
closer to winding down and resolving the Chapter 11 case it
started in September. The company, which publishes the New Haven
Register in Connecticut and other regional titles, delivers local
news and other information to about 1,000 communities in 10 states
and reaches 21 million people a month, according to its website.
Bloomberg related that Journal Register chose CMH as the buyer
because it was the company's only "stalking-horse" bidder. A
February auction was canceled due to a lack of other potential
buyers and objections by most other union groups were resolved
before the hearing, the company said in court papers.
CMH is an affiliate of funds managed by Alden Global Capital Ltd.,
which acquired two Journal Register loans totaling $152 million in
the previous bankruptcy in 2009. The debt exchange is called a
credit bid, in which buyers offer the value of the secured debt
they are owed in exchange for assets, Bloomberg said.
Bloomberg related that the company's sale agreement includes
severance and paid time off for employees who lose their jobs as a
result of the deal, the assumption of liabilities totaling $22.8
million and other costs, according to an amended sale agreement
filed with the court on March 15. The deal's total value wasn't
cited.
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.
JOURNAL REGISTER: Opinion on Sale Helps Union Workers
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the bankruptcy judge in New York told Journal
Register Co. in an eight-page opinion that he will approve sale of
the newspaper business to current lender and owner Alden Global
Capital Ltd., mostly in exchange for $114.15 million in secured
debt and $6 million cash.
Mr. Rochelle notes that although the unions lost this time around,
the opinion by Bankruptcy Judge Stuart M. Bernstein is a victory
for labor useful as a precedent in other cases.
The unions pointed to so-called successorship clauses in the
collective bargaining agreement where Journal Register is required
to compel any buyer to abide by the union contract. The company
contended the power to sell a business in bankruptcy free of
claims carries with it the ability to convey a business to a
purchaser without the obligation to take on a union contract.
Judge Bernstein disagreed.
Nonetheless, Journal Register, the report discloses, won and the
union lost since the contracts expire on March 31 by their own
terms. Because the sale can't be completed until after the
contracts expire, Judge Bernstein said the acquisition can go
forward.
Judge Bernstein was dealing with Section 1113 of the U.S.
Bankruptcy Code, which prohibits modifying a union contract
without going through an extensive litigation process to prove the
business can't survive unless wages or benefits are modified. The
judge referred to a provision in Section 1113 saying that no other
part of bankruptcy law can be used to avoid the litigation process
required by Section 1113.
Ordinarily, Judge Bernstein said that selling a business free of a
union contract would be tantamount to an evasion of Section 1113
and therefore isn't permissible. Journal Register's case is an
exception to the rule because the contracts are expiring by their
own terms imminently.
According to Mr. Rochelle, Judge Bernstein's opinion will be
useful for unions in other bankruptcies where buyers don't want to
take on union contracts. In those situations, if other courts go
along with Judge Bernstein, the bankrupt company must first knock
out the union agreements in compliance with Section 1113.
There were no bids to compete with Alden's, so an auction was
canceled. The contract calls for Alden also to pay off financing
for the bankruptcy and take on as much as $22.8 million in
liabilities.
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.
LAGUNA BRISAS: April 9 Combined Hearing on Plan, Outline Set
------------------------------------------------------------
On Feb. 14, 2013, the U.S. Bankruptcy Court for the Central
District of California entered an order approving the stipulation
entered into by and between 1st Deed Trust Holder Wells Fargo
Bank, N.A., Debtor Laguna Brisas, LLC, 2nd Trust Deed Holder Kay
Nam Kim and 3rd Trust Deed Holder Creditor Mehrdad Elie, to
continue (1) the hearing on the adequacy of the Debtor's
Disclosure Statement and (2) the Status Conference to April 9,
2013 at 2:00 p.m.
Wells Fargo is the Trustee for the registered holders of Bank of
America Commercial Mortgage Inc. Commercial Mortgage Pass-Through
Certificates, Series 2006-3.
In a minute entry entered a week later, the Bankruptcy Court
scheduled the confirmation hearing on the Debtor's Plan for
April 9, 2013, at 2:00 p.m.
Debtor's First Amended Plan
The Debtor filed on Jan. 16, 2013, a First Amended Disclosure
Statement for the Debtor's First Amended Chapter 11 Plan. The
Plan may provide for the Debtor to reorganize by continuing to
operate, to liquidate by selling assets of the estate, or a
combination of both.
The Debtor will fund the plan from the income it receives from the
operation of the Hotel.
Wells Fargo has filed a proof of claim asserting that its total
claim is $10,697,000 which includes: non-default interest of
$90,275.73; default interest of $121,795.72; legal fees of
$46,413,07, protective property advances of $7,178.20, late
charges of $18,246.80, and prepayment fee of $1,870,250.51.
Without the default interest and prepayment fee, the amount owed
is about $8,700,000. The Debtor has filed an objection to
portions of the Wells Fargo Claim.
Pursuant to the First Amended Chapter 11 Plan, the obligation of
the Debtor to Wells Fargo Bank, will be paid in full, at the
contract interest rate of 6.23%, as may be adjusted pursuant to
the terms of the Promissory Note, or approximately $57,000 per
month, starting on the first day of the first month following the
Effective Date, estimated to be May 1, 2013. The Debtor will pay
WFB a final payment of all amounts owed at the time on May 1,
2019.
Kay Nam Kim has an estimated claim of approximately $1.2 million.
The Debtor will pay Kay Nam Kim $600,000 on account of his Class 2
Claim as follows: monthly payments of $3,694 for 60 months and a
balloon payment of approximately $557,000 on the fifth anniversary
of the Effective Date. Until paid in full, the claim will accrue
interest at 6.25% on the amount of $600,000. The first payment
will be made on the first day of the first month following the
Effective Date, estimated to be May 1, 2013.
The remainder of the total claim of Kay Nam Kim is being paid in
the related bankruptcy case of Andy Kim. Upon payment of the
$600,000, Kay Nam Kim will reconvey his lien on the Hotel to the
Debtor.
The Debtor intends to object to portions of the Kay Nam Kim. The
Debtor will amend the Plan to provide for payment in full of the
Kay Nam Kim in the event that the Court denies all or any part of
the Debtor's objection to the Kay Nam Kim.
Holders of General Unsecured Claims will be paid in full, pro-
rata, in monthly installment of $43,000 over 58 months beginning
two months after the Effective Date. If the objections to the
claims of Wells Fargo and Kay Nam Kim are not successful, the
amount paid to unsecured creditors will be decreased by the amount
required to be paid to Wells Fargo and Kay Nam Kim.
A copy of the First Amended Disclosure Statement is available at:
http://bankrupt.com/misc/lagunabrisas.doc279.pdf
About Laguna Brisas
Laguna Beach, California-based Laguna Brisas LLC, doing business
as Best Western Laguna Brisas Spa Hotel, is owned by A&J Mutual,
LLC, which is owned and operated by Dae In "Andy" Kim and his wife
Jane. The Company owns a Best Western Plus Hotel and Spa in
Laguna Beach, California.
The Company filed for Chapter 11 protection (Bankr. C.D. Cal.
Case No. 12-12599) on Feb. 29, 2012. Bankruptcy Judge Mark S.
Wallace presides over the case.
The Debtor filed the Chapter 11 petition to stop foreclosure sale
of the first priority trust deed holder, Wells Fargo Bank. The
hotel has been in possession of and operated by a receiver, Bryon
Chapman of Rim Hospitality, since Oct. 3, 2011.
M. Jonathan Hayes, Esq., at the Law Office of M. Jonathan Hayes
represents the Debtor in its restructuring effort. Johnny Kim,
Esq. -- no relation to the Debtor's insider, "Andy" Kim --
represents the Debtor as special counsel. The Debtor disclosed
$15,097,815 in assets and $13,982,664 in liabilities.
The petition was signed by Dae In "Andy" Kim, managing member.
LAUSELL INC: FirstBank Withdraws Motion for Case Dismissal
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico has
accepted FirstBank of Puerto Rico's withdrawal of its motion to
dismiss Lausell, Inc.'s Chapter 11 case.
On Feb. 13, 2013, FirstBank asked the Court to dismiss the case
and deny the Debtor's motion to use the bank's cash collateral, in
view of the Debtor's actual position, without having available
cash collateral for its day to day operation.
FirstBank, as lender and administrative agent for the syndicatd
loan issued to the Debtor in conjunction with Citibank, N.A., and
Alcan Primary Products, LLC, filed a stipulation on the extension
of the use of cash collateral, adequate protection, critical
vendor designation of Alcan Primary Products, LLC and request for
its approval. An order was entered approving the Stipulation on
Jan. 9, 2013.
The Debtor has requested postpetition financing from EDB in order
to pay off the loans with the Banks, in a DOP transaction for the
reduced amount of $6.3 million. The Banks have agreed to the
instant Stipulation for the purpose of allowing the Debtor the
time required to finalize its loan application process with EDB.
As part of the Stipulation, the Debtor must submit reports on the
status of the EDB financing every two weeks with the first report
being due on Jan. 18, 2013.
According to FirstBank, the Debtor failed to provide the requested
report and is therefor in default as to the terms of the approved
Stipulation. "We have been promised an actual report, but the
same has not been forthcoming," Firstbank stated. Upon insistence
of the banks the Debtor provided a statement that everything was
the same with EDB.
As additional adequate protection payments, the Debtor is required
to make a payment to the Banks equivalent to the daily rate of
$1,035 to cover interest becoming due during the term of the
Stipulation. The Debtor is required to make monthly payments to
the Banks of $5,000, for a total of $20,000 during the period of
the Stipulation to cover accrued interest. FirstBank claimed that
the Debtor failed to make the last monthly payments in accordance
with the Stipulation.
On Feb. 21, 2013, FirstBank withdrew its dismissal motion, saying
that the Debtor has provided the information that had been
requested.
Firstbank is represented by:
F. David Godreau, Esq.
LATIMER, BIAGGI, RACHID & GODREAU
P.O. Box 9022512
San Juan, PR 00902-2512
Tel: (787) 724-0230
Fax: (787) 724-9171
About Lausell Inc.
Lausell, Inc., filed a bare-bones Chapter 11 petition (Bankr.
D.P.R. Case No. 12-02918) on April 17, 2012, in Old San Juan,
Puerto Rico. Lausell, also known as Aluminio Del Caribe, is a
manufacturer of windows and doors.
Bankruptcy Judge Mildred Caban Flores oversees the case. Charles
Alfred Cuprill, Esq., at Charles A. Curpill, PSC, serves as
counsel to the Debtor.
The Bayamon, Puerto Rico-based company disclosed $34,059,950 in
assets and liabilities of $24,489,414 in its amended schedules.
LDK SOLAR: EVP and Director Quits for Personal Reasons
------------------------------------------------------
LDK Solar Co., Ltd., announced that Dr. Liangbao Zhu has resigned
from the company for personal reasons effective March 17, 2013.
Dr. Zhu joined LDK Solar in 2005 and served as executive vice
president and a director of LDK Solar's Board.
The resignation of Dr. Zhu does not affect the composition of the
Audit, Compensation or Nominating and Corporate Governance
Committees of LDK Solar's Board.
"On behalf of LDK Solar, I would like to extend our appreciation
to Liangbao for the valuable service he provided during his time
with the company," stated Mr. Sam Tong, President and CEO of LDK.
"We wish him well in his future endeavors."
About LDK Solar
LDK Solar Co., Ltd. -- http://www.ldksolar.com-- based in Hi-
Tech Industrial Park, Xinyu City, Jiangxi Province, People's
Republic of China, is a vertically integrated manufacturer of
photovoltaic products, including high-quality and low-cost
polysilicon, solar wafers, cells, modules, systems, power
projects and solutions.
LDK Solar was incorporated in the Cayman Islands on May 1, 2006,
by LDK New Energy, a British Virgin Islands company wholly owned
by Xiaofeng Peng, LDK's founder, chairman and chief executive
officer, to acquire all of the equity interests in Jiangxi LDK
Solar from Suzhou Liouxin Industry Co., Ltd., and Liouxin
Industrial Limited.
KPMG in Hong Kong, China, said in a May 15, 2012, audit report,
there is substantial doubt on the ability of LDK Solar Co., Ltd.,
to continue as a going concern. According to KPMG, LDK Solar has
a net working capital deficit and is restricted to incur
additional debt as it has not met a financial covenant ratio
under a long-term debt agreement as of Dec. 31, 2011. These
conditions raise substantial doubt about the Group's ability to
continue as a going concern.
LDK Solar's balance sheet at Sept. 30, 2012, showed
US$5.76 billion in total assets, US$5.41 billion in total
liabilities, US$299.02 million in redeemable non-controlling
interests and US$45.91 million in total equity.
LEHMAN BROTHERS: Nevada Board of Finance Refuses to Settle
----------------------------------------------------------
Nevada is not immediately settling a $30 million lawsuit filed by
Lehman Brothers Commercial Bank, according to a March 13 report by
Las Vegas Sun. The state Board of Finance met behind closed doors
to discuss a proposal by a Nevada Supreme Court settlement judge
but the board did not vote. State Treasurer Kate Marshall said
settlement talks will continue and the board will consider the
issue again in 60 days, according to the report.
Lehman sued the state for breach of contract after it pulled
investments following a Moody's Investors Service downgrade in
2008.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
Lehman made its first payment of $22.5 billion to creditors in
April 2012 and a second payment of $10.2 billion on Oct. 1. A
third distribution is set for around March 30, 2013. The
brokerage is yet to make a first distribution to non-customers.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates.
LEHMAN BROTHERS: Suit Over $1.4-Bil. Assured Guaranty Fee Cut
-------------------------------------------------------------
Eric Hornbeck of BankruptcyLaw360 reported that a New York state
judge limited which contracts Lehman Brothers Holdings Inc.'s
bankrupt British subsidiary can challenge as it tries to collect a
$1.4 billion fee from monoline insurer Assured Guaranty Ltd. for
terminating mortgage-linked securities transactions early.
According to the BLaw360 report, Judge Marcy Friedman said the
Lehman subsidiary Lehman Brothers International (Europe) can
continue with its allegations that Assured Guaranty didn't act in
good faith when it terminated 28 contracts in July 2009, but
similar allegations over nine contracts terminated in December
2008 didn't hold muster.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
Lehman made its first payment of $22.5 billion to creditors in
April 2012 and a second payment of $10.2 billion on Oct. 1. A
third distribution is set for around March 30, 2013. The
brokerage is yet to make a first distribution to non-customers.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates.
LIBERTY MEDICAL: Meeting of Creditors Scheduled for March 27
------------------------------------------------------------
The U.S. Trustee for Region 3 will convene a meeting of creditors
in ATLS Acquisition, LLC, et al.'s Chapter 11 case on March 27,
2013, at 1 p.m. The meeting will be held at the J. Caleb Boggs
Federal Building, 844 King Street, 5th Floor, Room 5209,
Wilmington, Delaware.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
About Liberty Medical
Entities that own diabetics supply provider Liberty Medical led by
ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D.
Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than
three months after a management buy-out and amid a notice by the
lender who financed the transaction that it's exercising an option
to acquire the business.
Liberty has been in business for 22 years serving the needs of
both type 1 and type 2 diabetic patients. Liberty is a mail order
provider of diabetes testing supplies. In addition to diabetes
testing supplies, the Debtors also sell insulin pumps and insulin
pump supplies, ostomy, catheter and CPAP supplies and operate a
large mail order pharmacy. Liberty operates in seven different
locations and has 1,684 employees.
The Debtors have tapped Greenberg Traurig, LLP as counsel; Ernst &
Young LLP to provide investment banking advice; and Epiq
Bankruptcy Solutions, LLC as claims and noticing agent for the
Clerk of the Bankruptcy Court.
LIFECARE HOLDINGS: Seeks Exclusivity Even If Plan Unlikely
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that LifeCare Holdings Inc. expects to receive bankruptcy
court approval at an April 2 hearing for sale of the business to
senior lenders in exchange for $320 million in secured debt, plus
cash for professional expenses and wind-down costs after the sale.
According to the report, LifeCare said in a court filing that
required regulatory approvals won't allow completion of the sale
until July, even if the sale is approved on schedule. To
accommodate completion of the sale, LifeCare is asking the
bankruptcy judge to extend the exclusive right for proposing a
Chapter 11 plan until Aug. 31. The so-called exclusivity hearing
will take place April 9.
Whether there eventually will be a liquidating Chapter 11 plan
remains to be seen. LifeCare previously said the Chapter 11 case
will "most likely" be converted to liquidation in Chapter 7
following sale.
There were no bids to compete with the offer from the lenders,
because no one was willing to pay the $353.4 million owing on the
secured credit facility with JPMorgan Chase Bank NA as agent.
Consequently, the auction was canceled.
About LifeCare Hospitals
LCI Holding Company, Inc., and its affiliates, doing business as
LifeCare Hospitals, operate eight "hospital within hospital"
facilities and 19 freestanding facilities in 10 states. The
hospitals have about 1,400 beds at facilities in Louisiana, Texas,
Pennsylvania, Ohio and Nevada. LifeCare is controlled by Carlyle
Group, which holds 93.4% of the stock following a $570 million
acquisition in August 2005.
LCI Holding Company, Inc., and its affiliates, including LifeCare
Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead
Case No. 12-13319) on Dec. 11, 2012, with plans to sell assets to
secured lenders.
Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps,
Slate Meagher & Flom LLP, serve as counsel to the Debtors.
Rothschild Inc. is the financial advisor. Huron Management
Services LLC will provide the Debtors an interim chief financial
officer and certain additional personnel; and (ii) designate
Stuart Walker as interim chief financial officer.
The steering committee of lenders is represented by attorneys at
Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent
under the prepetition and postpetition secured credit facility is
represented by Simpson Thacher & Barlett LLP.
The Debtors disclosed assets of $422 million and liabilities
totaling $575.9 million as of Sept. 30, 2012. As of the
bankruptcy filing, total long-term obligations were $482.2 million
consisting of, among other things, institutional loans and
unsecured subordinated loans. A total of $353.4 million is owing
under the prepetition secured credit facility. A total of
$128.4 million is owing on senior subordinated notes. LifeCare
Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed
$24,028,730 in assets and $484,372,539 in liabilities as of the
Chapter 11 filing.
The Official Committee of Unsecured Creditors is represented by
Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves
as its financial advisor.
MAUI LAND: Cuts Number of Directors to Five
-------------------------------------------
Kent T. Lucien, who served on the Board of Directors of Maui Land
& Pineapple Company, Inc., since 2004 has decided not to seek
election as a director at the Company's Annual Meeting on
April 22, 2013. Effective Feb. 7, 2013, the Bylaws of the Company
were amended to reduce the number of directors on the Company's
Board of Directors from six to five.
About Maui Land & Pineapple Co.
Maui Land & Pineapple Company, Inc. (NYSE: MLP) --
http://mauiland.com/-- develops, sells, and manages residential,
resort, commercial, and industrial real estate. The Company owns
approximately 23,000 acres of land on Maui and operates retail,
utility operations, and a nature preserve at the Kapalua Resort.
The Company's principal subsidiary is Kapalua Land Company, Ltd.,
the operator and developer of Kapalua Resort, a master-planned
community in West Maui.
Maui Land incurred a net loss of $4.60 million in 2012, as
compared with net income of $5.07 million in 2011. The Company's
balance sheet at Dec. 31, 2012, showed $61.48 million in total
assets, $95.84 million in total liabilities and a $34.36 million
stockholders' deficiency.
Deloitte & Touche LLP, in Honolulu, Hawaii, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012, citing recurring negative cash
flows from operations and deficiency in stockholders' equity which
raise substantial doubt about the Company's ability to continue as
a going concern.
MBIA INC: Moody's Reviews Caa1 Senior Debt Rating for Downgrade
---------------------------------------------------------------
Moody's Investors Service placed on review for downgrade the
Insurance Financial Strength ratings of MBIA Insurance Corporation
(MBIA Corp., Caa2 IFS) and National Public Finance Guarantee
Corporation (National, Baa2 IFS) as well as the Caa1 senior debt
rating of MBIA Inc., the group's ultimate holding company. The
rating action also has implications for the various transactions
wrapped by MBIA Corp. and National.
Summary Rationale
The rating action reflects the precarious financial condition of
MBIA Corp. and the adverse effect that its weak credit profile and
a possible related regulatory action could have on the MBIA group.
Given its very tight liquidity position, MBIA Corp. may not have
enough resources to pay CMBS claims that could be presented this
year and there is thus a high risk of regulatory action. Such
regulatory action could expose MBIA Corp. to possible termination
of its CDS exposures at substantial market value losses,
overwhelming its financial resources. MBIA's auditors have
expressed substantial doubt about MBIA Corp.'s ability to continue
as a going concern.
MBIA Corp.'s deteriorating condition is adversely affecting the
rest of the group despite recent apparent successes in narrowing
intercompany linkages, such as the judicial decision validating
the 2009 regulatory approval of the split of MBIA's insurance
operations, and the amendments to MBIA Inc.'s debt indentures.
Nevertheless, National has extended a $1.7 billion secured loan to
MBIA Corp. which represents a majority of its equity, and exposes
National to potential losses or payment disruptions in the event
of regulatory action at MBIA Corp. Should the loan become
impaired, National's ability to pay dividends to cash poor MBIA
Inc. may be further constrained and its ability to write new
business may be further delayed. MBIA Inc. could also be directly
affected by stress at MBIA Corp. as a payment default of the
latter would accelerate certain guaranteed investment contracts
issued by MBIA Inc.
As part of the review, Moody's will focus on the risks to the
group presented by MBIA Corp.'s deteriorating CMBS exposure, the
effect of a possible regulatory action on MBIA Corp., as well as
the risks to National stemming from its secured loan to MBIA Corp.
including the potential for stress on the value of its collateral.
The rating agency will also assess any potential developments
related to putback claims and litigation.
Rating Rationale: -- MBIA Insurance Corporation
The Caa2 IFS rating, on review for downgrade, of MBIA Corp.,
reflects the insurer's proximity to a possible regulatory action,
given its weak liquidity position and the likelihood of large CMBS
claims being presented this year. While MBIA believes that it is
more likely than not that it will reach a settlement with its main
counterparty, Bank of America, N.A. (BofA), netting potential CMBS
claims owed to BofA and loan putback recoveries due from BofA,
which could improve liquidity and solvency, there is substantial
uncertainty about the likelihood, timing and terms of such
settlement.
Rating Rationale: -- MBIA UK
The B3 IFS rating, negative outlook, of MBIA UK Insurance Limited
(MBIA UK), reflects the deterioration of its insured portfolio and
the very weak credit profile of its parent and support provider,
MBIA Corp., mitigated in part by its stand-alone claims paying
resources. MBIA Corp.'s support of MBIA UK, in the form of excess
of loss reinsurance and net worth maintenance agreements, is
subordinated to insured claims and thus of limited value, in
Moody's opinion, due to MBIA Corp.'s weak credit profile.
Rating Rationale: -- National Public Finance Guarantee Corporation
The Baa2 IFS rating, on review for downgrade, of National reflects
the insurer's substantial claims-paying resources and high quality
insured portfolio, but also the adverse credit effect of its
substantial linkages with its weaker affiliates, notably through a
$1.7 billion secured loan to MBIA Corp and unresolved litigation
related to the group's 2009 restructuring. The balance of the loan
to MBIA Corp. increased from $1.1 billion at year-end 2011, and
equals more than 80% of National's total policyholders' surplus of
$2 billion at year-end 2012, and 29% of National's reported claims
paying resources. Moody's believes that the collateral supporting
the loan, consisting of net putback recoveries, excess spread on
second lien RMBS deals, and installment premiums, is of uncertain
value given the range of possible settlements, and that there is
considerable uncertainty around the amount and timing of cash
flows associated with these items in the event of regulatory
action on MBIA Corp. There is also limited visibility about
National's ability to reenter the financial guaranty business in
lights of the group's credit issues as well as due to broad market
skepticism about the value of bond insurance.
The rating agency stated that if a ratings downgrade were to occur
upon the conclusion of the review, National's rating is likely to
remain within one or two notches of the current level.
Rating Rationale: -- MBIA Inc.
The Caa1 senior debt rating, on review for downgrade, of MBIA
Inc.'s reflects the firm's substantial debt burden relative to its
stand-alone financial resources, resulting in part from large
losses in its wind-down businesses, and the uncertainty about the
financial condition of its subsidiaries and their related ability
to pay dividends. Notably, National's ability to pay dividends may
be further constrained should its loan to MBIA Corp. were to be
impaired. MBIA could also be directly affected by stress at MBIA
Corp. as an insolvency of the latter would accelerate certain
guaranteed investment contracts issued by MBIA Inc. While the
investment agreements are fully collateralized with high quality
collateral, the acceleration could reduce MBIA Inc.'s resources as
a result of make whole payments.
What Could Change The Ratings Up Or Down
The main rating sensitivities for the MBIA group relate to the
precarious financial condition of MBIA Corp., its proximity to a
possible regulatory action, and the knock on effect on its
affiliates. MBIA Corp.'s rating could be downgraded as a result of
further deterioration of its insured portfolio, its liquidity or
its capital profile, including a possible related regulatory
action. The ratings of MBIA Inc. and National could be downgraded
if stress at MBIA Corp. materially affected their credit profiles
given the nature of their exposures to the company.
The rating of MBIA Corp. could be confirmed, or even be upgraded,
if the insurer were able to substantially reduce the downside
risks of its insured portfolio and significantly improve its risk-
adjusted capitalization. The ratings of MBIA Inc. and National
could stabilize if MBIA's financial condition, its liquidity and
capital profile, improved or if their direct and indirect credit
linkages with MBIA Corp. were to materially reduce.
Moody's ratings of MBIA Mexico, S.A. de C.V. (MBIA Mexico) were
not part of this rating action.
Rating List:
On Review for Downgrade:
Issuer: MBIA Inc.
Senior Unsecured Regular Bond, Placed on Review for Downgrade,
currently Caa1
Issuer: MBIA Insurance Corp.
Insurance Financial Strength, Placed on Review for Downgrade,
currently Caa2
Issuer: National Public Finance Guarantee Corp.
Insurance Financial Strength, Placed on Review for Downgrade,
currently Baa2
Confirmation:
Issuer: MBIA UK Insurance Limited
Insurance Financial Strength, confirmed B3
Affirmations:
Issuer: MBIA Insurance Corporation
Pref. Stock Preferred Stock, Affirmed C (hyb)
Non-cumulative Preferred Stock, Affirmed C (hyb)
Subordinate Surplus Notes, Affirmed C (hyb)
Outlook Actions:
Issuer: MBIA Inc.
Outlook, Changed To Rating Under Review From Developing
Issuer: MBIA Insurance Corporation
Outlook, Changed To Rating Under Review From Developing
Issuer: MBIA UK Insurance Limited
Outlook, Changed To Negative From Rating Under Review
Issuer: National Public Finance Guarantee Corp
Outlook, Changed To Rating Under Review From Negative
Treatment Of Wrapped Transactions
Moody's ratings on securities that are guaranteed or "wrapped" by
a financial guarantor are generally maintained at a level equal to
the higher of the following: a) the rating of the guarantor (if
rated at the investment grade level); or b) the published
underlying rating (and for structured securities, the published or
unpublished underlying rating). Moody's approach to rating wrapped
transactions is outlined in Moody's special comment "Assignment of
Wrapped Ratings When Financial Guarantor Falls Below Investment
Grade" (May, 2008); and Moody's November 10, 2008 announcement
"Moody's Modifies Approach to Rating Structured Finance Securities
Wrapped by Financial Guarantors".
As a result of this rating action, the Moody's-rated securities
that are guaranteed or "wrapped" by MBIA Corp. and National are
placed on review for downgrade, except those with equal or higher
published underlying ratings (and for structured finance
securities, except those with equal or higher published or
unpublished underlying ratings). Also, the Moody's-rated
securities that are guaranteed or "wrapped" by MBIA UK are
confirmed at B3, except those with equal or higher published
underlying ratings (and for structured finance securities, except
those with equal or higher published or unpublished underlying
ratings).
The principal methodology used in this rating was Moody's Rating
Methodology for the Financial Guaranty Insurance Industry
published in September 2006.
MCCLATCHY CO: Chou Associates No Longer Owns Shares at Dec. 31
--------------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Chou Associates Management Inc. and Francis
S. M. Chou disclosed that, as of Dec. 31, 2012, they do not
beneficially own Class A Common Stock of The McClatchy Company.
A copy of the filing is available at http://is.gd/y7YJLs
About The McClatchy Company
Sacramento, Calif.-based The McClatchy Company (NYSE: MNI)
-- http://www.mcclatchy.com/-- is the third largest newspaper
company in the United States, publishing 30 daily newspapers, 43
non-dailies, and direct marketing and direct mail operations.
McClatchy also operates leading local Web sites in each of its
markets which extend its audience reach. The Web sites offer
users comprehensive news and information, advertising, e-commerce
and other services. Together with its newspapers and direct
marketing products, these interactive operations make McClatchy
the leading local media company in each of its premium high growth
markets. McClatchy-owned newspapers include The Miami Herald, The
Sacramento Bee, the Fort Worth Star-Telegram, The Kansas City
Star, The Charlotte Observer, and The News & Observer (Raleigh).
For the year ended Dec. 30, 2012, the Company reported a net loss
of $144,000 on $1.23 billion of revenue, as compared with net
income of $54.38 million on $1.26 billion of revenue for the year
ended Dec. 25, 2011.
The Company's balance sheet at Sept. 23, 2012, showed
$2.88 billion in total assets, $2.67 billion in total liabilities,
and $210.29 million in stockholders' equity.
* * *
McClatchy carries a 'Caa1' corporate family rating from Moody's
Investors Service. In May 2011, Moody's changed the rating
outlook from stable to positive following the company's
announcement that it closed on the sale of land in Miami for
$236 million. The outlook change reflects Moody's expectation
that McClatchy will utilize the net proceeds to reduce debt,
including its underfunded pension position, which will reduce
leverage by approximately half a turn and lower required
contributions to the pension plan over the next few years.
McClatchy Co. carries a 'B-' Corporate Credit Rating from
Standard & Poor's Ratings Services.
MERISEL INC: Amends Current Report on Form 8K/A
-----------------------------------------------
Merisel, Inc., has amended its current report on Form 8-K
originally filed on Jan. 4, 2013, to amend and supplement
information provided in Item 5.02. The Amendment does not
otherwise amend or modify the disclosures contained in the
Original Form 8-K, or update the disclosures contained in the
Original Form 8-K to reflect any events that have occurred after
the filing date of the Original Form 8-K.
New York Apartment
As previously disclosed on the Company's quarterly report on Form
10-Q filed on Nov. 26, 2012, as a result of Hurricane Sandy which
struck the Atlantic coast on October 29th and 30th of 2012, the
Company's facility in Carlstadt, New Jersey, lost power and then
was flooded resulting in significant damage to critical equipment
located at the facility including computer systems and the vast
majority of output equipment. Following Hurricane Sandy, the
Company leased a corporate apartment in Jersey City, New Jersey,
to provide housing to the Company's executives during the
reconstruction period for the facility. The Jersey City Lease
will terminate on March 31, 2013. Effective as of April 1, 2013,
the Company has agreed to provide a corporate apartment in New
York, New York, for the use of key executives and sales personnel
through the 2013 fiscal year. The lease for the New York
Apartment will not exceed $4,000 per month during such year.
EVP and COO
Effective Dec. 6, 2012, the board of directors of the Company
appointed Jeb Ball to serve as an Executive Vice President and the
Chief Operating Officer of the Company, at an annual salary of
$175,000. Mr. Ball, age 47, joined the Company on Aug. 1, 2012,
as Vice President of Operations of the Company. Previously, Mr.
Ball was an Executive Vice President of Sales and Marketing at
Dynagraf Inc. from 2009 to 2012. Prior to that Mr. Ball was
President of Premier Color from 2004 to 2009 and President of
United Lithograph Inc. from 2001 to 2004. In connection with Mr.
Ball's appointment, the Company agreed to reimburse Mr. Ball for
his commuting costs from Boston, Massachusetts to the Company's
headquarters in New York, New York. On March 8, 2013 the Company
agreed to reimburse Mr. Ball for up to $18,000 (or $1,500 per
month) in commuting costs for the 2013 fiscal year. Prior to that
date Mr. Ball was reimbursed for commutation expenses of
approximately $3,448.
Expense Reimbursement
In November of 2012, Terry A. Tevis, the Company's President and
Chief Executive Officer, moved his permanent address to Florida.
From November 2012 to March 8, 2013, Mr. Tevis was reimbursed for
expenses of approximately $5,694 incurred in commuting from
Florida to the Company's headquarters in New York, New York. On
March 8, 2013, the Company agreed with Mr. Tevis that he would be
reimbursed for travel expenses from Florida to the Company's
offices in Atlanta, Georgia and Burbank, California or a customer
sales call.
Director
On Dec. 31, 2012, the board of directors of the Company appointed
Eric Salzman as an independent director to fill the vacancy
created on the five member board of directors by the resignation
of Joseph Yang in October 2012. Mr. Salzman currently serves as
the Managing Member of Sarnihaan Capital Partners LLC, a
consulting firm he established to focus on special situations,
restructurings and cross capital structure investments. Mr.
Salzman holds an M.B.A. from Harvard Graduate School of Business
Administration and a B.A. from the University of Michigan.
About Merisel
Merisel operates in a single reporting segment, the visual
communications services business. It entered that business
beginning March 2005, through a series of acquisitions, which
continued through 2006. These acquisitions include Color Edge,
Inc., and Color Edge Visual, Inc.; Comp 24, LLC; Crush Creative,
Inc.; Dennis Curtin Studios, Inc.; Advertising Props, Inc.; and
Fuel Digital, Inc.
The Company's balance sheet at Sept. 30, 2012, showed
$23.3 million in total assets, $34.1 million in total liabilities,
and a stockholders' deficit of $10.8 million.
"The Company had a cash balance of $286,000 at Sept. 30, 2012, and
experienced reduced revenues for the three and nine months ended
Sept. 30, 2012, compared to the same periods in 2011, resulting in
a net loss and net cash used in operating activities for the
interim periods then ended. Additionally, during October 29th and
30th the Company's Carlstadt, New Jersey facility experienced
significant damage due to Hurricane Sandy. The Company will incur
additional expenses for the replacement/repair of damaged
equipment and to continue to service its client base until the
facility is fully operational. It is anticipated that the
additional costs incurred will exceed the insurance proceeds; the
extent to which is uncertain. These factors raise substantial
doubt about the Company's ability to continue as a going concern,"
according to the Company's quarterly report for the period ended
Sept. 30, 2012.
MERRIMACK PHARMACEUTICALS: Incurs $24.9MM Loss in 4th Quarter
-------------------------------------------------------------
Merrimack Pharmaceuticals, Inc., reported a net loss of $24.89
million on $14.19 million of collaboration revenues for the three
months ended Dec. 31, 2012, as compared with a net loss of $18.22
million on $12.57 million of collaboration revenues for the same
period during the prior year.
For the year ended Dec. 31, 2012, the Company incurred a net loss
of $91.75 million on $48.92 million of collaboration revenues, as
compared with a net loss of $79.67 million on $34.21 million of
collaboration revenues during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed $148.97
million in total assets, $155.39 million in total liabilities,
$97,000 in non-controlling interest and a $6.51 million total
stockholders' deficit.
"We continue to make steady progress in advancing our therapeutic
and diagnostic candidates toward our ambition to provide new
regimens for patients to dramatically improve cancer outcomes,"
said Robert Mulroy, President and CEO of Merrimack. "We are
encouraged by the medical community's strong support as we enroll
clinical studies across multiple indications and remain on track
to announce top line results from a number of these trials in
2013."
A copy of the press release is available for free at:
http://is.gd/hqHpcK
About Merrimack
Cambridge, Mass.-based Merrimack Pharmaceuticals, Inc., a
biopharmaceutical company discovering, developing and preparing to
commercialize innovative medicines consisting of novel
therapeutics paired with companion diagnostics. The Company's
initial focus is in the field of oncology. The Company has five
programs in clinical development. In it most advanced program,
the Company is conducting a pivotal Phase 3 clinical trial.
METROGAS SA: Incurs ARS142.8-Mil. Net Loss in 2012
--------------------------------------------------
MetroGAS S.A. furnished the U.S. Securities and Exchange
Commission on Form 6-K on March 18, 2013, its report on the
Company's consolidated financial statements for the year ended
Dec. 31, 2012.
Price Waterhouse & CO. S.R.L., in Buenos Aires, Argentina,
expressed substantial doubt about MetroGas S.A.'s ability to
continue as a going concern, citing the uncertainties derived from
the delay in obtaining tariff increases and the continuous
increase in operating expenses that have negatively affected the
Company's economic and financial position and from the completion
of the voluntary reorganization proceedings filed by the Company
with an Argentine Court on June 17, 2010.
The Company reported a net loss of ARS142.8 million on
ARS1.210 billion of sales in 2012, compared with a net loss of
ARS61.1 million on ARS1.161 billion of sales in 2011.
The Company's balance sheet at Dec. 31, 2012, showed
ARS2.435 billion in total assets, ARS2.061 billion in total
liabilities, minority interest of ARS989,000 and shareholders'
equity of ARS373.0 million.
A copy of the Form 6-K is available at http://is.gd/mtqKZO
Headquartered in Buenos Aires, Argentina, MetroGAS S.A. is the
largest gas distribution company in Argentina in terms of number
of customers and of delivered gas volumes. MetroGAS distributes
approximately 20.4% of the total natural gas supplied by the nine
distribution companies licensed after the privatization of Gas del
Estado in late 1992, and currently has approximately 2.2 million
customers in its service area (Buenos Aires City and eleven
municipalities in the south of Greater Buenos Aires), a densely
populated area including major power plants and other industrial
and commercial users.
As a consequence of different scenarios that significantly
affected the Company's ability to generate enough fund flows to
satisfy payments to its suppliers and financial creditors, on
June 17, 2010, MetroGAS' Board of Directors requested a
Reorganization proceeding which was filed before the National
Court for Commercial Matters No. 26, Secretariat No.51, case
record No. 056,999. The Shareholders' Assembly carried out on
Aug. 2, 2010, ratified the decision taken by the Board.
In Feb. 2, 2012, the Company presented a total and final
reformulation of the preventive agreement proposal for unsecured
creditors who are verified and declared acceptable consisting in
the payment of verified or declared unsecured credits by means of
releasement, swap or "dacion en pago" of such credits, of two
kinds of negotiable bonds (the "New Negotiable Bonds") to be due
on Dec. 31, 2018.
During the Bondholders' Meeting of MetroGAS S.A, on June 18, 2012,
the proposal for the reorganization proceedings of MetroGAS S.A.
was unanimously accepted by the Company's creditors.
MGM RESORTS: Tracinda Plans to Purchase Additional Shares
---------------------------------------------------------
Tracinda Corporation, on March 13, 2013, filed with the Federal
Trade Commission a Notification pursuant to the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the rules
promulgated thereunder in connection with its potential purchases
of additional shares of Common Stock either in the open market or
directly from third parties.
Tracinda is precluded from acquiring additional shares of Common
Stock until the required waiting period under the HSR Act has
expired or been terminated. In addition, Tracinda complies with
the Company's Securities Trading Policy and, therefore, may
generally purchase Common Stock only during "trading windows"
established by the Company.
The next trading window is expected to open on the third trading
day following issuance of the Company's earnings release for the
quarter ended March 31, 2013. Tracinda expects to use working
capital to fund any purchases. Under the HSR Act, following
expiration or termination of the applicable waiting period,
Tracinda would be permitted to increase its ownership level up to
25% (the next reporting threshold above Tracinda's current
ownership level of 18.6%) of the outstanding shares of Common
Stock. However, no decision has been made as to the number of
shares which may be acquired. That determination will depend upon
various factors, including market conditions at the time Tracinda
is permitted to purchase Common Stock.
Tracinda monitors its investment in the Company by, among other
things, contacting Company management to address operations and
market conditions. Tracinda continues to believe that there is
substantial value in the assets of MGM Resorts and that the
Company is a good long-term investment. As the Company's largest
stockholder, Tracinda occasionally receives inquiries regarding
the Company and Tracinda's shares of Common Stock.
A copy of the regulatory filing is available for free at:
http://is.gd/nBCNPp
About MGM Resorts
MGM Resorts International (NYSE: MGM) --
http://www.mgmresorts.com/-- has significant holdings in gaming,
hospitality and entertainment, owns and operates 15 properties
located in Nevada, Mississippi and Michigan, and has 50%
investments in four other properties in Nevada, Illinois and
Macau.
The Company reported net income of $3.23 billion in 2011 and a net
loss of $1.43 billion in 2010. MGM's balance sheet at Sept. 30,
2012, showed $27.83 billion in total assets, $18.56 billion in
total liabilities, and $9.26 billion in total stockholders'
equity.
Bankruptcy Warning
In the Form 10-K for the year ended Dec. 31, 2011, the Company
said that any default under the senior credit facility or the
indentures governing the Company's other debt could adversely
affect its growth, its financial condition, its results of
operations and its ability to make payments on its debt, and could
force the Company to seek protection under the bankruptcy laws.
* * *
As reported by the TCR on Nov. 14, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on MGM Resorts
International to 'B-' from 'CCC+'. In March 2012, S&P revised
the outlook to positive from stable.
"The revision of our rating outlook to positive reflects strong
performance in 2011 and our expectation that MGM will continue to
benefit from the improving performance trends on the Las Vegas
Strip," S&P said.
In March 2012, Moody's Investors Service affirmed its B2 corporate
family rating and probability of default rating. The affirmation
of MGM's B2 Corporate Family Rating reflects Moody's view that
positive lodging trends in Las Vegas will continue through 2012
which will help improve MGM's leverage and coverage metrics,
albeit modestly. Additionally, the company's declaration of a $400
million dividend ($204 million to MGM) from its 51% owned Macau
joint venture due to be paid shortly will also improve the
company's liquidity profile. The ratings also consider MGM's
recent bank amendment that resulted in about 50% of its
$3.5 billion senior credit facility being extended one year from
2014 to 2015.
As reported by the TCR on Oct. 15, 2012, Fitch Ratings has
affirmed MGM Resorts International's (MGM) Issuer Default Rating
(IDR) at 'B-' and MGM Grand Paradise, S.A.'s (MGM Grand Paradise)
IDR at 'B+'.
MICHAELS STORES: Reports $214 Million Net Income in Fiscal 2012
---------------------------------------------------------------
Michaels Stores, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing net income of
$214 million on $4.40 billion of net sales for fiscal year 2012,
as compared with net income of $176 million on $4.21 billion of
net sales for fiscal year 2011.
Michaels Stores' balance sheet at Feb. 2, 2013, showed
$1.54 billion in total assets, $3.80 billion in total liabilities,
and a $2.25 billion total stockholders' deficit.
A copy of the Form 10-K is available for free at:
http://is.gd/Py9onS
About Michaels Stores
Headquartered in Irving, Texas, Michaels Stores, Inc., is the
largest arts and crafts specialty retailer in North America. As
of March 9, 2009, the Company operated 1,105 "Michaels" retail
stores in the United States and Canada and 161 Aaron Brothers
Stores.
* * *
As reported by the TCR on April 5, 2012, Moody's Investors Service
upgraded Michaels Stores, Inc.'s Corporate Family Rating to B2
from B3. "The upgrade of Michaels' Corporate Family Rating
primarily reflects the positive benefits of its continuing
business initiatives which have led to consistent improvements in
same store sales," said Moody's Vice President Scott Tuhy.
In the April 16, 2012, edition of the TCR, Standard & Poor's
Ratings Services raised its corporate credit rating on Irving,
Texas-based Michaels Stores Inc. to 'B' from 'B-'. "Standard &
Poor's Ratings Services' upgrade on Michaels Stores reflects the
improvement in financial ratios following the company's
performance in the important fourth quarter, given the seasonality
of the company's business," said Standard & Poor's credit analyst
Brian Milligan. "The CreditWatch placement remains effective,
given the pending IPO."
MMODAL INC: S&P Lowers CCR to 'B' on Slow Revenue Growth
--------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Franklin, Tenn.-based MModal Inc to 'B' from 'B+'. The
outlook is stable.
S&P also lowered the issue-level ratings on MModal's $520 million
senior secured credit facilities, which consist of a $75 million
revolving credit facility due 2017 and a $445 million term loan
due 2019 to 'B+' from 'BB-'. The recovery rating remains at '2',
indicating out expectations for substantial (70% to 90%) recovery
in the event of a payment default.
In addition, S&P lowered its issue-level rating on the company's
$250 million unsecured notes due 2020 to 'CCC+' from 'B-'. The
recovery rating remains at '6', indicating S&P's expectations for
negligible (0% to 10%) recovery in the event of a payment default.
"The downgrade follows weakening in the company's revenues as a
result of a slower-than-expected transition to its new products
strategy, coupled with competitive pricing pressures, leading to a
lower EBITDA base and leverage reaching the 6x area at the quarter
ended September 2012," said Standard & Poor's credit analyst David
Tsui.
"The ratings on MModal reflect our view that U.S. health care
providers' increasing adoption of technology for clinical
documentation, a recurring revenue base, high renewal rates, and a
diversified customer base are offset by company's highly leveraged
financial profile, indicated by its debt-to-EBITDA level reaching
6x at the quarter ended September 2012. We view MModal's business
risk profile as "weak" because it has a narrow focus on the
generally fragmented U.S. clinical documentation industry, which
includes a more diversified direct competitor with greater
financial resources. We expect revenue to return to mid-single-
digit growth over the near term as the company completes orders
for new products and recognizes revenues as a result," S&P said.
MModal is a leading provider of clinical narrative capture
services, speech and natural language understanding technology,
and clinical documentation workflow solutions to the U.S. health
care industry.
The stable outlook reflects the S&P's view that the company's
highly recurring revenue base and diversified customer base will
continue to support modest but consistent FOCF generation, despite
slower-than-expected sales due to product transitions. S&P could
lower the rating if revenue growth slows further, or competitive
pressures cause a significant deterioration in EBITDA margins,
leading to FOCF generation below 2% of total adjusted debt.
S&P would consider an upgrade over the intermediate term if
product transition takes hold such that consistent revenue growth
and consistent profitability leads to debt-to-EBITDA sustained at
or below the 5x area.
MORGANS HOTEL: OTK Associates Nominates Seven Directors
-------------------------------------------------------
OTK Associates, LLC, Robert S. Taubman and Michael E. Olshan
sent a letter to the Secretary of Morgans Hotel Group Co.
indicating their intent to (i) nominate seven persons to the Board
of Directors at the forthcoming 2013 annual meeting of
stockholders and (ii) present proposals for shareholder vote at
the Annual Meeting. The nominees are:
(1) John J. Dougherty;
(2) Jason T. Kalisman;
(3) Mahmood Khimji;
(4) Jonathan Langer;
(5) Andrea L. Olshan;
(6) Michael E. Olshan; and
(7) Parag Vora.
OTK intends to submit, for a stockholder vote at the Annual
Meeting, the following proposals:
* "RESOLVED, that any provision of the Bylaws of Morgans Hotel
Group Co. as of the date of effectiveness of this resolution
that was not included in the Bylaws, effective as of
March 15, 2013, be and hereby is repealed."
* "RESOLVED, that Section 2.6 of the Bylaws of Morgans Hotel
Group Co. be amended and replaced in its entirety with the
following: "At each meeting of the Board of Directors a
majority of the entire Board shall constitute a quorum for
the transaction of business. The vote of seventy-five (75%)
of the directors present at a meeting at which a quorum is
present shall be the act of the Board unless the certificate
of incorporation or these by-laws shall require a vote of a
greater number. In case at any meeting of the Board a
quorum shall not be present, the members or a majority of
the members of the Board present may adjourn the meeting
from time to time until a quorum shall be present."
As of March 18, 2013, OTK Associates, LLC, and its affiliates
beneficially own 4,500,000 shares of common stock of Morgans Hotel
Group Co. representing 13.91% of the shares outstanding.
A copy of the regulatory filing is available for free at:
http://is.gd/mOYDLQ
About Morgans Hotel Group
Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) --
http://www.morganshotelgroup.com/-- is widely credited as the
creator of the first "boutique" hotel and a continuing leader of
the hotel industry's boutique sector. Morgans Hotel Group
operates and owns, or has an ownership interest in, Morgans,
Royalton and Hudson in New York, Delano and Shore Club in South
Beach, Mondrian in Los Angeles and South Beach, Clift in San
Francisco, Ames in Boston, and Sanderson and St Martins Lane in
London. Morgans Hotel Group and an equity partner also own the
Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans
Hotel Group also manages hotels in Isla Verde, Puerto Rico and
Playa del Carmen, Mexico. Morgans Hotel Group has other property
transactions in various stages of completion, including projects
in SoHo, New York and Palm Springs, California.
The Company incurred a net loss attributable to common
stockholders of $66.81 million in 2012, a net loss attributable to
common stockholders of $95.34 million in 2011, and a net loss
attributable to common stockholders of $89.96 million in 2010.
The Company's balance sheet at Dec. 31, 2012, showed $591.15
million in total assets, $728.47 million in total liabilities,
$6.05 million in redeemable noncontrolling interest, and a $143.37
million total deficit.
MUSCLEPHARM CORP: Company Presentation for March 2013
-----------------------------------------------------
MusclePharm Corporation released a presentation dated March 14,
2013. The Company diclosed that net sales have grown from $1
million in 2009 to $78 million in 2012. The presentation also
discussed about the Company's marketing and branding strategy,
growth strategy, company goals and sales & margin improvement.
A copy of the presentation is available for free at:
http://is.gd/xSx9r2
About MusclePharm
Headquartered in Denver, Colorado, MusclePharm Corporation
(OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life-
style company that develops and manufactures a full line of
National Science Foundation approved nutritional supplements that
are 100% free of banned substances. MusclePharm is sold in over
120 countries and available in over 5,000 U.S. retail outlets,
including GNC and Vitamin Shoppe. MusclePharm products are also
sold in over 100 online stores, including bodybuilding.com,
Amazon.com and Vitacost.com.
The Company reported a net loss of $23.28 million in 2011,
compared with a net loss of $19.56 million in 2010. The Company's
balance sheet at Sept. 30, 2012, showed $7.81 million in total
assets, $15.10 million in total liabilities, and a $7.29 million
total stockholders' deficit.
In the auditors' report accompanying the consolidated financial
statements for the year ended Dec. 31, 2011, Berman & Company,
P.A., in Boca Raton, Florida, expressed substantial doubt about
the Company's ability to continue as a going concern. The
independent auditors noted that the Company has a net loss of
$23,280,950 and net cash used in operations of $5,801,761 for the
year ended Dec. 31, 2011; and has a working capital deficit of
$13,693,267, and a stockholders' deficit of $12,971,212 at
Dec. 31, 2011.
NAVISTAR INTERNATIONAL: Fitch Affirms 'CCC' Issuer Default Rating
-----------------------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Ratings (IDR) for
Navistar International Corporation (NAV), Navistar, Inc. and
Navistar Financial Corporation at 'CCC'. In addition, Fitch has
upgraded NAV's senior unsecured notes to 'CCC' from 'CCC-' and
NFC's senior secured bank credit facilities to 'CCC' from 'CCC-',
based on modestly improved recovery prospects.
Fitch has also affirmed the rating for Navistar, Inc.'s senior
secured bank term loan at 'B'/'RR1' with the expectation that
anticipated changes in covenants for the term loan will not have a
significant impact on the loan's priority status in Navistar's
debt structure or on recovery prospects.
The Rating Outlook is Positive. A full list of ratings is shown at
the end of this release.
NAV announced earlier this week it plans to reprice and amend its
$1 billion senior secured term loan to extend the maturity from
July 2014 to August 2017 and amend certain covenants to provide
additional operating flexibility. In addition, the term loan would
be reduced with proceeds from the issuance of $300 million of
unsecured debt to be completed concurrently with the term loan
amendments. Lender consent will be required for the term loan
repricing and amendments.
Key Rating Drivers
The Positive Outlook reflects the positive impact of the planned
refinancing on NAV's liquidity. Total debt would remain unchanged,
but extending the maturity date of the term loan would improve the
company's liquidity profile by reducing the large amount of debt
maturing in 2014. The shift of $300 million of debt from a secured
to unsecured basis would improve recovery prospects for unsecured
debt holders. In addition, NAV has made meaningful progress in
executing the transition to its revised engine strategy and
recently appointed a permanent CEO effective in April 2013. It
continues to restructure operations to cut costs and improve
efficiency which can be expected to support margins over the long
term.
Near term concerns remain, however, including declines in the
company's market share, high warranty costs, operating losses,
negative free cash flow, and tepid demand for trucks that reflects
slow economic growth and cost pressures faced by truck purchasers
related to fuel costs and driver availability.
The ratings also incorporate concerns surrounding the availability
and use of emissions credits, which began to run out in the second
fiscal quarter of 2013 for some heavy duty engines. In addition,
NAV is still working to achieve on-board diagnostics (OBD)
certification in 2013 for certain engines. As a result, occasional
gaps in deliveries could exacerbate market share concerns while
NAV implements its revised engine strategy. NAV's share in its
traditional heavy and medium truck and bus markets was 18% in the
first fiscal quarter of 2013 compared to 23% in fiscal 2012 and
34% as recently as 2010. Emission credits are a particular concern
in 10 states that use California Air Resources Board (CARB)
standards which do not allow the use of NCPs. There are sufficient
emissions credits to support medium duty engine sales into 2014.
Fitch expects manufacturing free cash flow (FCF) to be negative
through at least the first half of fiscal 2013 due to seasonally
low cash flow; delays in deliveries due to the depletion of
emissions credits; and expenditures related to warranties, non-
conformance penalties (NCPs), and ongoing pension contributions.
FCF could be pressured if industry demand for trucks does not
improve or the company's market share does not recover.
Liquidity is well above $1 billion which provides a cushion to
absorb negative cash flow in the near term. NAV's manufacturing
cash and marketable securities declined to just under $1.2 billion
at Jan. 31, 2013 from $1.5 billion at Oct. 31, 2012. This level of
cash, combined with availability under a $175 million ABL
facility, is sufficient to mitigate near-term liquidity concerns
while NAV makes the transition to its revised engine strategy.
Cash balances could weaken modestly before the company begins
shipping heavy duty trucks with its own proprietary MaxxForce 13-
liter engines that include Selective Catalytic Reduction (SCR)
after-treatment technology by the end of the fiscal second
quarter.
Current maturities of manufacturing long term debt were modest at
$125 million at Jan. 31, 2013. Debt maturities exceed $1.5 billion
in 2014 but would decline by $1 billion upon completion of NAV's
planned amendments and debt issuance. $570 million of subordinated
convertible debt is scheduled to mature in October 2014.
Sales declined 12% year-over-year in the first quarter of 2013 due
to weak industry demand for trucks and NAV's declining market
share. EBITDA was slightly above break-even in the first quarter
of fiscal 2013. Results could improve during the year if NAV
executes its revised engine strategy on time and begins to rebuild
market share. In order to rebuild its operating performance and
preserve cash, NAV is limiting capital spending, cutting back on
certain investments associated with NAV's global expansion, and
focusing engineering efforts on its engine strategy. Restructuring
should also help control NAV's costs over the long term, including
workforce reductions. NAV estimates these actions will reduce its
cost structure by $175 million or more beginning in 2013.
Warranty expense more than doubled in 2012 to $895 million, mostly
related to complexity surrounding engine emissions regulations.
The charges included more than $400 million of adjustments to pre-
existing warranties. As NAV incorporates improvements in newer
engines, warranty expense should decline in 2013. However, cash
charges are likely to increase in the near term as NAV makes
repairs related to accrued warranty liabilities.
Pension contributions represent a recurring use of cash, but
required contributions during the next few years should be
slightly lower than originally anticipated due to MAP-21
legislation passed in 2012. The legislation allows a portion of
required contributions to be temporarily deferred, but the total
obligation is unaffected. NAV estimates it will be required to
contribute $166 million in 2013 and at least $200 million annually
between 2014 and 2016. NAV contributed $157 million in 2012. NAV's
net pension obligations increased to $2.1 billion at the end of
fiscal 2012 from $1.8 billion in 2011.
NAV's revised engine strategy involves combing NAV's advanced
exhaust gas recirculation (EGR) technology with Cummins SCR
engines and emissions technology. In December 2012, NAV launched
on time the ProStar with the Cummins ISX 15-liter engine and is
scheduled to phase in its own 13-liter SCR engines beginning in
April 2013, followed by medium duty engines later in 2013 or 2014.
NAV will require approval by the EPA and CARB of its reconfigured
emissions compliant engines as well as approval of on-board
diagnostics.
Rating Sensitivities
Fitch could take a positive rating action if manufacturing FCF
returns toward a sustainable breakeven level during 2013, the SCR
engine strategy is implemented on time, the company's market share
begins to recover, and earnings improve steadily.
Fitch could take a negative rating action if NAV's market share
fails to recover materially as it gradually completes the
transition to SCR emissions technology, or if FCF and liquidity do
not begin to recover after the middle of fiscal 2013. If sales
volumes are low or margins remain pressured, FCF could be
impaired, making it difficult to fund capital expenditures,
pension contributions and higher interest expense associated with
an increase in debt during late fiscal 2012. Five investors have
accumulated, in aggregate, more than 60% of NAV's common shares,
which contributes to some uncertainty about long-term operating
and financial policies. The ratings could also be negatively
affected depending on the outcome of the SEC's investigation of
the company's accounting and disclosure practices.
The Recovery Rating (RR) of '1' for Navistar Inc.'s $1 billion
term loan supports a rating of 'B', three levels above NAV's IDR,
as the loan can be expected to recover more than 90% in a
distressed scenario based on a strong collateral position. The
upgrade to 'RR4' from 'RR5' for NAV's senior unsecured debt
reflects better recovery prospects, which are viewed as average in
a distressed scenario, due to steady progress in the transition to
NAV's revised engine strategy and, to a smaller degree, to NAV's
planned refinancing. The RR '6' for the senior subordinated
convertible notes reflects a low priority position relative to
NAV's other debt.
NFC
Fitch believes NFC is core to NAV's overall franchise, and the IDR
of the finance subsidiary is directly linked to that of its
ultimate parent due to the close operating relationship and
importance to NAV, as substantially all of NFC's business is
connected to the financing of new and used trucks sold by NAV and
its dealers. The linkage also reflects the potential that, under a
stress scenario, NAV may seek to extract capital and/or
unencumbered assets from NFC.
The relationship between NAV and NFC is formally governed by the
Master Intercompany Agreement. Also, there is a requirement
referenced in NFC's credit agreement requiring Navistar, Inc. or
NAV to own 100% of NFC's equity at all times.
Fitch views NFC's operating performance and overall credit metrics
as neutral to NAV's rating. NFC's performance has not changed
materially compared to Fitch's expectations, but its financial
profile remains tied to NAV's operating and financial performance.
Total financing revenue declined in first quarter 2013 (1Q13) on
continued reduction of NFC's retail portfolio balance and lower
wholesale financing volume to dealers. The average receivables
balance declined to $1.7 billion at Jan. 31, 2013 compared to $2.5
billion one-year prior.
NFC's asset quality remains stable, reflecting the mature retail
portfolio which is running off. Charge-offs and provisioning
volatility has declined as NFC focuses on its wholesale portfolio,
which historically has experienced lower loss rates relative to
the retail portfolio.
Absent material dividends to the parent, Fitch expects NFC's
leverage to improve and stay below historical levels due to
reduced financing needs. Balance sheet leverage, as measured by
total debt to equity fell to a historical low of 2.5x in 1Q13.
Management believes NFC can more effectively operate with a
leverage target between 5x and 6x, consistent with historic levels
and with other Fitch-rated captives. The company may also
reestablish dividends from NFC to NAV in efforts to maintain
adequate asset coverage and leverage, as well as to enhance
liquidity at NAV in the medium to longer term.
Liquidity is adequate at Jan. 31, 2013, with $13.1 million of
unrestricted cash and approximately $1.1 billion of availability
under its various borrowing facilities. In February 2013, NFC
completed a refinancing of a portion of its borrowing facilities
which Fitch believes mitigates some potential near-term liquidity
constraints.
The upgrade of the RR to '4' from '5' reflects improved asset
coverage for NFC's senior secured credit facilities, which
supports a rating equalized with the IDR of 'CCC', reflecting
average recovery prospects in a distressed scenario.
As of Jan. 31, 2013, Fitch's ratings covered approximately $2.9
billion of debt at NAV and $1.6 billion of outstanding debt at the
Financial Services segment, the majority of which is at NFC.
Fitch has affirmed these ratings:
Navistar International Corporation
-- Long-term IDR at 'CCC';
-- Senior subordinated notes at 'CC'/'RR6'.
Navistar, Inc.
-- Long-term IDR at 'CCC';
-- Senior secured bank term loan at 'B'/'RR1'.
Navistar Financial Corporation
-- Long-term IDR at 'CCC'.
Fitch has upgraded these ratings:
Navistar International Corporation
-- Senior unsecured notes to 'CCC'/'RR4' from 'CCC-'/'RR5'.
Cook County, Illinois
-- Recovery zone revenue facility bonds (Navistar International
Corporation Project) series 2010 to 'CCC' from 'CCC-'.
Illinois Finance Authority (IFA)
-- Recovery zone revenue facility bonds (Navistar International
Corporation Project) series 2010 to 'CCC' from 'CCC-'.
Navistar Financial Corporation
-- Senior secured bank credit facilities to 'CCC'/'RR4' from
'CCC-'/'RR5'.
The Rating Outlook is positive.
NEONODE INC: Incurs $9.3 Million Net Loss in 2012
-------------------------------------------------
Neonode Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$9.28 million on $7.13 million of net revenues for the year ended
Dec. 31, 2012, as compared with a net loss of $17.14 million on
$6.06 million of net revenues in 2011. The Company incurred a
$31.62 million net loss in $2010.
The Company's balance sheet as of Dec. 31, 2012, showed $12.16
million in total assets, $4.06 million in total liabilities and
$8.10 million in total stockholders' equity.
"I am extremely pleased with our success in further-penetrating
new high-volume markets, while diversifying our customer base. In
2012, we doubled the number of signed technology license
agreements to 24, including customers who sell into the following
end markets: automotive, tablets, mobile phones, toys, office
equipment and e-readers. We also worked aggressively to create
value with new breakthrough technologies such as proximity
sensing, 10-finger touch, and flush bezel designs. These new
innovations will allow Neonode to capture new customers and
further distinguish ourselves from our competitors. During 2012
we filed 47 new patent applications, up from an aggregate of 17 in
prior years. It is very gratifying to me personally to have
achieved this remarkable level of disruptive technology innovation
in an area that is a great passion of mine," stated Neonode CEO,
Thomas Eriksson.
A copy of the Form 10-K is available for free at:
http://is.gd/M1UXr6
About Neonode Inc.
Lafayette, Calif.-based Neonode Inc. (OTC BB: NEON)
-- http://www.neonode.com/-- provides optical touch screen
solutions for hand-held and small to midsize devices.
NUVILEX INC: MMS Incorporated in Nevada State
---------------------------------------------
Medical Marijuana Sciences, Inc., was incorporated in the State of
Nevada and is a wholly-owned subsidiary of Nuvilex, Inc. MMS will
conduct research and development for the treatment of diseases
using compounds derived from the plant Cannabis sativa. A copy of
the MMS Corporate Charter and Articles of Incorporation is
available for free at http://is.gd/Jmpe2g
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.
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.
The Company's balance sheet at Oct. 31, 2012, showed $2.31 million
in total assets, $3.79 million in total liabilities, $580,000 in
preferred stock, and a $2.05 million total stockholders' deficit.
NUVILEX INC: Delays Jan. 31 Form 10-Q for Review
------------------------------------------------
Nuvilex, Inc., was unable to file its quarterly report on Form
10-Q for the period ended Jan. 31, 2013, within prescribed time
period as the Company requires additional time to finalize its
financial statements for review by its independent accountant.
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.
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.
The Company's balance sheet at Oct. 31, 2012, showed $2.31 million
in total assets, $3.79 million in total liabilities, $580,000 in
preferred stock, and a $2.05 million total stockholders' deficit.
OCEAN DRIVE: Assets Sold to Grand Heritage Int'l
------------------------------------------------
Ocean Drive Investment LLC and Cavalier Hotel LLC's First Amended
Disclosure Statement in support of the Debtors' Joint Plan of
Reorganization dated Jan. 13, 2013, relates that the Plan proposes
the sale of all of the Debtors' assets to Grand Heritage
International LLC, which is a development company for several
hotels throughout the U.S. and abroad, or an affiliate to be
formed for the purpose of acquiring and maintaining the assets.
The Purchaser will pay Ridge Hill $3 million upon the Effective
Date and issue a promissory note for the balance of its Allowed
Secured Claim. In addition, the Purchaser will inject $1 million
of working capital into the Hotel's operations which include,
among other things, improvements to the Hotel and the payment of
Administrative Expenses and Allowed Priority Claims. The Debtors
estimate that the Administrative Expenses on the Effective Date
will approximate $100,000 and the Priority Claims will not be
greater than $10,000.
The Plan contains 14 Classes of Claims and Interests. There are 8
Classes of Secured Claims, 4 Classes of Unsecured Claims, and two
(2) Classes of Interests. All Classes of Claims and Interests are
Impaired.
All Allowed Unsecured Claims will be paid in accordance with the
Plan. The sum total to each class will approximate 70% of the
total of the Allowed Unsecured Claims. The Unsecured Claims will
be paid in monthly installments commencing July 1, 2013. General
Holders of Unsecured Claims of ODI, estimated at $461,916.33, and
Holders of General Unsecured Claims of Cavalier Hotel LLC,
estimated at $31,000, will receive a monthly pro rata distribution
of 70% of their Allowed Claims in equal monthly installments over
a period of 5 years. In addition, they will receive a pro rata
share of the cash available from the Debtor's operations on the
Effective Date.
Interests in ODI in Class 13 and Interests in Cavalier Hotel LLC
in Class 14 will be canceled upon the issuance of a Final Decree.
Funds generated from operations until the Effective Date will be
used for Plan Payments and general operations. However, cash on
hand on Confirmation from all Debtors will be available for the
payment of General Unsecured Creditors of ODI and Cavalier Hotel
LLC.
A copy of the First Amended Disclosure Statement is available at:
http://bankrupt.com/misc/OceanDrive.doc120.pdf
About Ocean Drive Investment and Cavalier Hotel
Ocean Drive Investment LLC and Cavalier Hotel LLC filed for
Chapter 11 protection (Bankr. S.D. Fla. Case No. 12-30448 and
12-30451) on Aug. 28, 2012, in Miami.
ODI is the owner of the Cavalier hotel located at Ocean Drive,
in Miami's South Beach, facing the Atlantic Ocean. The Hotel has
46 rooms and is just within walking distance to bars, shops,
dining, nightlife, and the nonstop action of South Beach.
Cavalier Hotel LLC is the management company that operates and
manages the Hotel.
Ocean Drive has scheduled assets of $16,000,000 and liabilities of
$10,558,303 as of the Petition Date. Cavalier Hotel LLC estimated
under $50,000 in assets and at least $10 million in liabilities.
The Debtors are represented by Nicholas B. Bangos, Esq., in Miami.
OMEGA NAVIGATION: Creditors Voting on 2.5% to 4% Plan
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Omega Navigation Enterprises Inc. turned ownership of
the eight vessels over to secured lenders as part of a settlement
generating $500,000 for distribution to unsecured creditors.
According to the report, the bankruptcy judge in Houston approved
explanatory disclosure materials allowing creditors to vote on a
Chapter 11 plan incorporating the settlement. A confirmation
hearing for approval of the plan will take place April 22.
The report relates the disclosure statement says that a gross of
$1.8 million is theoretically available for unsecured creditors.
Professional fees exceeding prior estimates mean the net available
for distribution is $1 million to $1.5 million. The disclosure
statement says it's possible there could be nothing for unsecured
creditors if other claims with higher priority come in larger than
anticipated. Otherwise, the predicted recovery is 2.5% to 4% for
unsecured creditors whose claims range from $40 million to
$120 million.
The report relates that in the senior lender settlement, the
secured creditors waived claims and agreed to pay most
professional expenses while providing $500,000 for distribution to
unsecured creditors.
About Omega Navigation
Athens, Greece-based Omega Navigation Enterprises Inc. and
affiliates, owner and operator of tankers carrying refined
petroleum products, filed for Chapter 11 protection (Bankr. S.D.
Tex. Lead Case No. 11-35926) on July 8, 2011, in Houston, Texas
in the United States.
Omega is an international provider of marine transportation
services focusing on seaborne transportation of refined petroleum
products. The Debtors disclosed assets of US$527.6 million and
debt totaling US$359.5 million. Together, the Debtors wholly own
a fleet of eight high-specification product tankers, with each
vessel owned by a separate debtor entity.
HSH Nordbank AG, as the senior lenders' agent, has first liens on
vessels to secure a US$242.7 million loan. The lenders include
Bank of Scotland and Dresdner Bank AG. The ships are encumbered
with US$36.2 million in second mortgages with NIBC Bank NV as
agent. Before bankruptcy, Omega sued the senior bank lenders in
Greece contending they violated an agreement to grant a three
year extension on a loan that otherwise matured in April 2011.
An affiliate of Omega that manages the vessels didn't file, nor
did affiliates with partial ownership interests in other vessels.
Judge Karen K. Brown presides over the case. Bracewell &
Giuliani LLP serves as counsel to the Debtors. Jefferies &
Company, Inc., is the financial advisor and investment banker.
The Official Committee of Unsecured Creditors has tapped Winston
& Strawn as local counsel; Jager Smith as lead counsel; and First
International as financial advisor.
ORAGENICS INC: Board OKs up to $140,000 Bonus for CEO in 2013
-------------------------------------------------------------
The compensation committee of Oragenics, Inc., approved the 2013
performance objectives for the Company's president and chief
executive officer, Dr. John Bonfiglio under his cash bonus plan.
Dr. Bonfiglio's employment agreement with the Company required the
adoption of a bonus plan to provide for a bonus target of up to
50% of his annual base salary which equates to $140,000. The
Company put the bonus plan in place when Dr. Bonfiglio joined the
Company. The bonus payable to Dr. Bonfiglio for 2013 will be
based on the achievement of certain objectives, which are
substantially similar to those adopted by the Committee in the
prior year.
In addition to the chief executive cash bonus program, the
Compensation Committee approved a comparable cash bonus program
for the Company's chief financial officer, Michael Sullivan and
its vice president of research and development, Dr. Martin
Handfield. Under that cash bonus program Mr. Sullivan and Dr.
Handfield are eligible for cash bonuses of up to $45,000 and
$42,750, respectively, equaling to 25% of their base salaries.
Long-Term Incentive Program
On Feb. 11, 2013 the Committee and Board approved an amendment to
participating executive's long-term performance-based equity
incentive program administered under the Company's 2012 Equity
Incentive Plan. The Amendments consist of (i) an extension of the
Termination Date in the individual award agreements from Dec. 31,
2013, to Dec. 31, 2014; and (ii) the addition of four new
performance goals.
Non-Employee Director Compensation
On Feb. 11, 2013, the Board considered and approved amendments to
Company's non-employee director long-term performance based equity
incentive compensation program which is administered under the
Company's 2012
The amendments consist of (i) an extension of the Termination Date
in the individual award agreements from Dec. 31, 2013, to Dec. 31,
2014; and (ii) the addition of four new performance goals. These
changes were considered by the Committee to be in the best
interest of the Company and necessary to attract and retain highly
qualified directors to serve on the Company's Board.
The Board also ratified and approved the changes to the director
compensation program. The long term incentive plan is comparable
in all respects to the long-term incentive plan for the designated
executive officers and employee participants, including the
Performance Goals.
Director Nominations
The Company has set Thursday, June 6, 2013, as the date for its
2103 annual meeting of shareholders. The date will be
substantially earlier than the prior year's annual meeting which
was held on Oct. 23, 2012. Because the date of the meeting is
more than 30 days before the anniversary of the Company's 2012
annual meeting of shareholders, proposals to be included in the
Company's proxy statement for the 2013 annual meeting of
shareholders in accordance with Rule 14a-8 under the Securities
Exchange Act of 1934, as amended, must be received on or before
March 31, 2013, which the Company believes is a reasonable time
before it expects to begin to print and send its proxy materials.
Shareholders must deliver the proposals or nominations to the
Company's principal executive offices at the following address:
Oragenics, Inc., Attn: Corporate Secretary, 4902 Eisenhower
Boulevard, Suite 125, Tampa, Florida 33634.
A complete copy of the Form 8-K is available for free at:
http://is.gd/GRtjfJ
About Oragenics Inc.
Tampa, Fla.-based Oragenics, Inc. -- http://www.oragenics.com/--
is a biopharmaceutical company focused primarily on oral health
products and novel antibiotics. Within oral health, Oragenics is
developing its pharmaceutical product candidate, SMaRT Replacement
Therapy, and also commercializing its oral probiotic product,
ProBiora3. Within antibiotics, Oragenics is developing a
pharmaceutical candidate, MU1140-S and intends to use its
patented, novel organic chemistry platform to create additional
antibiotics for therapeutic use.
In its audit report on the Company's 2011 financial statements,
Mayer Hoffman McCann P.C., in Clearwater, Florida, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has incurred recurring operating losses, negative operating cash
flows and has an accumulated deficit.
The Company reported a net loss of $7.67 million in 2011, compared
with a net loss of $7.80 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $12.58
million in total assets, $1.75 million in total liabilities, all
current, and $10.83 million in total shareholders' equity.
Bankruptcy Warning
The Company said in its annual report for the year ended Dec. 31,
2011, that its loan agreement with the Koski Family Limited
Partnership matures in three years and select material assets of
the Company relating to or connected with its ProBiora3, SMaRT
Replacement Therapy, MU1140 and LPT3-04 technologies have been
pledged as collateral to secure the Company's borrowings under the
Loan Agreement. This secured indebtedness could impede the
Company from raising the additional equity or debt capital the
Company needs to continue its operations even though the amount
borrowed under the Loan Agreement automatically converts into
equity upon a qualified equity financing of at least $5 million.
The Company's ability to repay the loan will depend largely upon
the Company's future operating performance and the Company cannot
assure that its business will generate sufficient cash flow or
that the Company will be able to raise the additional capital
necessary to repay the loan. If the Company is unable to generate
sufficient cash flow or are otherwise unable to raise the funds
necessary to repay the loan when it becomes due, the KFLP could
institute foreclosure proceedings against the Company's material
intellectual property assets and the Company could be forced into
bankruptcy or liquidation.
ORMET CORP: Melts Opposition to $90M DIP Financing
--------------------------------------------------
Jamie Santo of BankruptcyLaw360 reported that having smoothed over
differences with two key creditors, aluminum smelter Ormet Corp.
on Thursday submitted final versions of its Chapter 11 bidding
procedures and $90 million debtor-in-possession financing package,
which enshrines private equity firm Wayzata Investment Partners
LLC as the stalking horse bidder, for a Delaware bankruptcy
judge's approval.
The report related that earlier iterations of the $90 DIP facility
and the auction procedures had come under fire from the Pension
Benefit Guaranty Corp. and Ormet's committee of unsecured
creditors.
About Ormet Corp.
Aluminum producer Ormet Corporation, along with affiliates, filed
for Chapter 11 protection (Bankr. D. Del. Case No. 13-10334) on
Feb. 25, 2013, with a deal to sell the business to a portfolio
company owned by private investment funds managed by Wayzata
Investment Partners LLC.
Headquartered in Wheeling, West Virginia, Ormet --
http://www.ormet.com/-- is a fully integrated aluminum
manufacturer, providing primary metal, extrusion and thixotropic
billet, foil and flat rolled sheet and other products.
Ormet disclosed assets of $406.8 million and liabilities totaling
$416 million. Secured debt of about $180 million includes $139.5
million on a secured term loan and $39.3 million on a revolving
credit.
Attorneys at Dinsmore & Shohl LLP and Morris, Nichols, Arsht &
Tunnell LLP serve as counsel to the Debtors. Kurtzman Carson
Consultants is the claims and notice agent. Evercore's Lloyd
Sprung and Paul Billyard serve as investment bankers to the
Debtor.
OVERLAND STORAGE: Registers 14.5 Million Common Shares
------------------------------------------------------
Overland Storage, Inc., issued $13,250,000 convertible promissory
notes in a private placement on Feb. 13, 2013. The Notes are
convertible into 10,192,304 shares of common stock at an initial
conversion price of $1.30 per share and automatically convert into
shares of common stock upon the occurrence of certain events.
The Company filed a Form S-1 registration statement with the U.S.
Securities and Exchange Commission for the resale of the shares of
common stock issuable upon conversion of the Notes.
The company has also registered for resale by the selling
shareholders up to an additional 4,326,526 shares of common stock
in the event of interest payments on the Notes in shares of common
stock. The Company will not receive any of the proceeds from the
shares of common stock sold by the selling shareholders.
The Notes are scheduled to mature in February 2017 and bear
interest at a rate of 8% per annum payable semi-annually. The
Company may pay interest on the Notes in cash or in shares of
common stock at the Company's option beginning the quarter ending
June 30, 2013; provided that at any time Cyrus Opportunities
Master Fund II, Ltd., CRS Master Fund, L.P., Crescent 1, L.P., and
Cyrus Select Opportunities Master Fund, Ltd., holds 20% or more of
the then-outstanding common stock, the Initial Purchaser will have
the option to determine whether the applicable interest payment
payable to the Initial Purchaser is payable in cash or shares of
common stock. The Notes are secured by a pledge of 65% of the
stock of each of the Company's foreign subsidiaries.
The Company's common stock is traded on The NASDAQ Capital Market
under the symbol "OVRL". On March 13, 2013, the last reported
sale price for the Company's common stock on The NASDAQ Capital
Market was $1.19 per share. The Notes are not listed on any
national securities exchange.
A copy of the Form S-1 prospectus is available for free at:
http://is.gd/onaK0f
About Overland Storage
San Diego, Calif.-based Overland Storage, Inc. (Nasdaq: OVRL) --
http://www.overlandstorage.com/-- is a global provider of unified
data management and data protection solutions designed to enable
small and medium enterprises (SMEs), corporate departments and
small and medium businesses (SMBs) to anticipate and respond to
change.
Moss Adams LLP, in San Diego, California, issued a "going concern"
qualification on the consolidated financial statements for the
year ended June 30, 2012. The independent auditors noted that the
Company's recurring losses and negative operating cash flows raise
substantial doubt about the Company's ability to continue as a
going concern.
The Company incurred a net loss of $16.16 million for the fiscal
year 2012, compared with a net loss of $14.49 million for the
fiscal year 2011. The Company's balance sheet at Dec. 31, 2012,
showed $28.31 million in total assets, $31.23 million in total
liabilities and a $2.92 million total sharehodlers' deficit.
OVERSEAS SHIPHOLDING: Files Schedules of Assets and Liabilities
---------------------------------------------------------------
Affiliates of Overseas Shipholding Group, Inc., filed with the
U.S. Bankruptcy Court for the District of Delaware schedules of
assets and liabilities.
As earlier reported, lead debtor Overseas Shipholding Group, Inc.,
disclosed $1,788,825,473 in assets and $2,052,881,743 in
liabilities as of the Chapter 11 filing.
The debtor-affiliates disclosed:
Company Assets Liabilities
------- ------ -----------
First Union Tanker Corporation $65,437,999 $11,383,028
Cabo Sounion Limited $65,080,870 $20,752,892
Carl Product Corporation $63,435,531 $6,329,921
Cabo Hellas Limited $62,901,429 $20,349,765
Epsilon Aframax Corporation $61,419,295 $44,613,244
Delta Aframax Corporation $61,131,973 $44,628,283
DHT Ann VLCC Corp. $37,873,717 $28,300,338
Eighth Aframax Tanker Corporation $33,715,052 $32,832,657
Caribbean Tanker Corporation $31,024,243 $0
DHT Chris VLCC Corp. $30,771,973 $23,673,140
Carina Tanker Corporation $20,250,991 $24,230,263
DHT Cathy Aframax Corp. $17,659,493 $18,441,005
DHT Regal Unity VLCC Corp $15,261,915 $16,474,526
Dignity Chartering Corporation $14,624,416 $26,406,715
DHT Sophie Aframax Corp. $11,996,427 $12,504,819
Concept Tanker Corporation $10,026,591 $11,095,109
DHT Rebecca Aframax Corp. $2,607,607 $1,881,013
DHT Ania Aframax Corp. $1,596,295 $1,392,759
Crown Tanker Corporation $521,550 $101,257
Overseas Diligence LLC $450,742 $348,393
Edindun Shipping Corporation $0 $0
Delphina Tanker Corporation $0 $0
About Overseas Shipholding
Overseas Shipholding Group, Inc., headquartered in New York, is
one of the largest publicly traded tanker companies in the world,
engaged primarily in the ocean transportation of crude oil and
petroleum products. OSG owns or operates 111 vessels that
transport oil and petroleum products throughout the world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. Cleary Gottlieb
Steen & Hamilton LLP serves as OSG's Chapter 11 counsel, while
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
OVERSEAS SHIPHOLDING: Enters Truce with BP In Venture Fight
-----------------------------------------------------------
Eric Hornbeck of BankruptcyLaw360 reported that bankrupt Overseas
Shipholding Group Inc. asked a Delaware bankruptcy judge Wednesday
to sign off on a truce with a BP PLC unit over the future of a
joint shipping venture, setting aside their differences for at
least as long as the oil shipper remains in bankruptcy.
According to the report, under the terms of the proposal, BP Oil
Shipping Co. USA Inc. won't question OSG's stake in Alaska Tanker
Co. LLC, a four-tanker joint venture that carries all of BP's
crude oil from Alaska's North Slope to the West Coast.
About Overseas Shipholding
Overseas Shipholding Group, Inc., headquartered in New York, is
one of the largest publicly traded tanker companies in the world,
engaged primarily in the ocean transportation of crude oil and
petroleum products. OSG owns or operates 111 vessels that
transport oil and petroleum products throughout the world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. Cleary Gottlieb
Steen & Hamilton LLP serves as OSG's Chapter 11 counsel, while
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
OXFORD RESOURCE: 2012 10-K to be Delayed; Expects $26.1MM Net Loss
------------------------------------------------------------------
Oxford Resource Partners, LP, says the filing of its annual report
on Form 10-K for the year ended Dec. 31, 2012, will be delayed.
According to the Company, it has been actively working with its
lenders to amend the provisions and extend the term of its
existing credit facility. These efforts have been ongoing and
extensive and have required the Company to devote key personnel
and administrative resources, including the personnel and
resources of its accounting and financial reporting organization.
The Company expects to file its Annual Report on Form 10-K within
the grace period prescribed by Rule 12b-25 under the Securities
Exchange Act of 1934, as amended.
The Company says that if it is unsuccessful in this effort, (i)
the Company will be required to reclassify all of its outstanding
revolving credit indebtedness as a current liability and (ii) the
Company will be unable to demonstrate that its existing sources of
cash would be adequate to meet its liquidity requirements for the
one-year period immediately following the issuance of its audited
financial statements for the period ended Dec. 31, 2012, creating
uncertainty about the Company's ability to continue as a going
concern.
The Company anticipates reporting the following significant
changes for the fiscal year:
* Revenues are expected to be $373.5 million for 2012, as
compared to revenues of $400.4 million for 2011, with the
reduction in revenues being due primarily to the decreased
production and sales from its Illinois Basin operations.
* The Company expects to report a net loss for 2012 of
$26.1 million, as compared to a net loss for 2011 of $8.3 million.
This increase in the net loss was primarily due to lower sales
volume resulting from lower production from the Company's Illinois
Basin operations and the related impairment and restructuring
expenses.
* Adjusted EBITDA is expected to be $47.9 million for 2012, as
compared to Adjusted EBITDA of $58.8 million for 2011. "Adjusted
EBITDA" is defined as the Company's net (loss) income before
interest, income taxes, depreciation, depletion, and amortization,
non-cash equity-based compensation expense, gain or loss on the
disposal of assets, amortization of below-market coal sales
contracts, impairment and restructuring charges, non-cash change
in mine reclamation obligations and certain non-recurring costs.
About Oxford Resource
Columbus, Ohio-based Oxford Resource Resource Partners, LP, is a
low-cost producer of high value steam coal, and is the largest
producer of surface mined coal in Ohio.
The Company reported a net loss of $20.2 million on $287.0 million
of revenues for the nine months ended Sept. 30, 2012, compared
with a net loss of $4.0 million on $304.1 million of revenues for
the same period of 2011.
The Company's balance sheet at Sept. 30, 2012, showed
$233.2 million in total assets, $214.2 million in total
liabilities, and partners' capital of $19.0 million.
A copy of the Form 10-Q is available at http://is.gd/z6lWfJ
PARKERVISION INC: Incurs $20.3-Mil. Net Loss in 2012
----------------------------------------------------
ParkerVision, Inc., filed on March 18, 2013, its annual report on
Form 10-K for the year ended Dec. 31, 2012.
PricewaterhouseCoopers LLP, in Jacksonville, Florida, expressed
substantial doubt about ParkerVision's ability to continue as a
going concern, citing the Company's recurring losses from
operations and negative cash flows.
The Company reported a net loss of $20.3 million in 2012, compared
with a net loss of $14.6 million in 2011. The Company had no
product or royalty revenues for the years ended Dec. 31, 2012, and
2011.
The Company's net loss increased approximately $5.7 million from
2011 to 2012. This increase was a result of the $5.7 million
increase in operating expenses, which includes a $2.4 million
increase in litigation fees and expenses and a $2.1 million
increase in overall share-based compensation.
The Company's balance sheet at Dec. 31, 2012, showed $18.7 million
in total assets, $2.2 million in total liabilities, and
stockholders' equity of $16.5 million.
A copy of the Form 10-K is available at http://is.gd/qJvYK2
Jacksonville, Florida-based ParkerVision, Inc., designs, develops
and markets its proprietary radio frequency ("RF") technologies
and products for use in semiconductor circuits for wireless
communication products.
Since 2005, the Company has generated no product or royalty
revenue from its wireless technologies. It has made significant
investments in developing and protecting its technologies and
products, the returns on which are dependent upon the generation
of future revenues for realization.
The Company is currently engaged in patent litigation with
Qualcomm Incorporated for their alleged infringement of a number
of the Company's patents that relate to the Company's receiver
intellectual property. The trial is scheduled to begin in October
2013. Although the Company's litigation team is working on a
partial contingency basis, the Company expects to incur
significant costs for legal and expert fees related to this
litigation in 2013 and possibly beyond.
PATIENT SAFETY: Incurs $2.2 Million Net Loss in 2012
----------------------------------------------------
Patient Safely Technologies, Inc., filed with the U.S. Securities
and Exchange Commission its annual report on Form 10-K disclosing
a net loss of $2.20 million on $17.58 million of revenue for the
year ended Dec. 31, 2012, as compared with a net loss of $1.89
million on $9.46 million of revenue during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed $19.71
million in total assets, $7.27 million in total liabilities and
$12.43 million in total stockholders' equity.
A copy of the Form 10-K is available for free at:
http://is.gd/3bY2lq
About Patient Safety Technologies
Patient Safety Technologies, Inc. (OTC: PSTX) --
http://www.surgicountmedical.com/-- through its wholly owned
operating subsidiary SurgiCount Medical, Inc., provides the
Safety-Sponge(TM) System, a system designed to improve the
standard of patient care and reduce health care costs by
preventing the occurrence of surgical sponges and other retained
foreign objects from being left inside patients after surgery.
RFOs are among one of the most common surgical errors.
PATRIOT COAL: Peabody Objects to Retiree Panel's Rule 2004 Motion
-----------------------------------------------------------------
Peabody Energy Corporation and Peabody Holding Company, LLC,
object to the Official Committee of Salaries Retirees' motion of
Patriot Coal Corporation, et al., for authorization to examine the
Debtors pursuant to Rule 2004 of the Federal Rules of Bankruptcy
Procedure.
Specifically, Peabody objects to the Retiree Committee's request
to (i) waive the meet-and-confer requirement of Local Rule 2004(A)
and (ii) shorten the notice requirement of Local Rule 2004(C). In
support of this Objection, Peabody says:
* The Retiree Committee has shown no cause whatsoever for asking
the Court to absolve the Retiree Committee of the requirement that
it meet and confer in good faith pursuant to Local Rule 2004(A).
First, the Retiree Committee's initial demand that Peabody respond
to an extremely broad document request -- covering more than
40 years' worth of documents -- in one day was unreasonable on its
face. Second, after Peabody's counsel had reached out to
communicate several times about the status of their attempts to
reach the appropriate personnel at Peabody, counsel for the
Retiree Committee proceeded to file its Bankruptcy Rule 2004
Motion without waiting to confer, knowing that Peabody's counsel
was in Court.
* The Retiree Committee has not attempted to show cause for
seeking to require Peabody to provide a detailed response to the
Motion in three days, especially when the Motion pertains to broad
requests that cover more than 40 years. For the Retiree Committee
to state that Peabody "has had notice of these requests since
March 13, 2013," with full knowledge of the attempts of Peabody's
counsel to confer with their client and provide a response, flouts
this Court's good-faith conference requirement. Given the Retiree
Committee's perfunctory observance of this Court's rules, there is
no reason for the Court to hear this matter before Peabody even
has the seven days permitted by rule to respond.
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis & Frankel LLP serves as its counsel.
Houlihan Lokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
PATRIOT COAL: Retiree Committee Retaining Stahl Cowen as Counsel
-------------------------------------------------------------=--
The official Salaries Retiree Committee of Patriot Coal
Corporation, et al., asks the U.S. Bankruptcy Court for the
Eastern District of Missouri for authorization to retain the law
firm of Stahl Cowen Crowley Addis LLC ("SCCA") as its counsel,
nunc pro tunc to Jan. 4, 2013.
SCCA will, among others, engage in all activities required by the
Retiree Committee, including:
a. counseling the Retiree Committee with respect to
understanding the bankruptcy process, advising the Retiree
Committee members with respect to their fiduciary duties;
b. assisting in Retiree Committee communications with the
affected retiree constituency and maintenance of a website
to provide information to same;
c. taking actions to obtain information and discovery with
respect to the retiree benefits sought to be modified or
terminated by the Debtors; and
d. investigation of all historical plan documents and
presentation of plans to retirees.
In addition to the foregoing activities, if and to the extent that
the scope of the Retiree committee is enlarged, SCCA will, among
others, further engage in:
a. investigation of the financial condition of the Debtors;
b. review and consideration of necessary equitable
considerations arising under Section 1114 of the Bankruptcy
Code;
c. analysis of any proposals made by the Debtors pursuant to
Section 1114 of the Bankruptcy code and assistance in any
counteroffers to such proposals; and
d. Negotiation, discovery and/or litigation with respect to the
rights and interests of the Retiree Committee in the event
that a voluntary resolution is not reached, including but
not limited to defense against any appeals of any Court
order affecting retiree benefits and/or relating to Section
1114.
The range of SCCA's hourly rates for its attorneys and legal
assistants is:
Partners $430-$560
Associates $255-$370
Legal Assistants/Paralegals $120-$200
SCCA is not owed any money by the Debtors pre-petition and
represents no interest adverse to the Retiree Committee or its
affected members individually. Based on its investigation, SCCA
has no connection with the Debtors, the creditors or any other
party-in-interest; and SCCA does not hold or represent any
interest adverse to the Retiree Committee and SCCA is a
"disinterested person" within the meaning of Section 101(14) of
the Bankruptcy Code.
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis & Frankel LLP serves as its counsel.
Houlihan Lokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
On March 7, 2013, Paul A. Randolph, Assistant U.S. Trustee for
Region 13, appointed seven (7) creditors to serve in the official
Salaried Retiree Committee.
PATRIOT COAL: Creditor Ohio Valley Coal Opposes Rejection Motion
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Missouri
granted Patriot Coal Corporation and its affiliated Debtors
permission to file the Debtors' (i) Motion to Reject Collective
Bargaining Agreements and to Modify Retiree Benefits Pursuant to
11 U.S.C. Section 1113, 1114; (ii) Memorandum in Support of the
Debtors' Motion to Reject Collective Bargaining
Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C.
Sections 1113, 1114; and (iii) declarations and exhibits filed in
support thereof under seal.
As reported in the TCR on March 18, 2013, the Motion to Reject
Collective Bargaining Agreements and to Modify Retiree Benefits
Pursuant to 11 U.S.C. Sections 1113, 1114, the Memorandum in
support of the Motion and the declarations and exhibits filed in
support of the Motion contain certain highly confidential and
sensitive information, including information about the Debtors'
liquidity, near-term financial outlook and business plan, all of
which constitutes "confidential . . . commercial information"
under Section 107(b)(1) of the Bankruptcy Code.
According to Patriot, disclosure of the Confidential Information
would cause significant harm to the Debtors' commercial
relationships and competitive position.
The hearing to consider the Motion is scheduled for April 10,
2013, at 10:00 a.m. and April 11, 2013, at 10:00 a.m.
Ohio Valley Coal Objects to Rejection Motion
Ohio Valley Coal Company and The Ohio Valley Transloading Company
(collectively "Ohio Valley Coal") object to the relief sought in
the Rejection Motion on the following grounds:
(a) the potential impact of recoveries from Peabody Energy Corp.
and/or Arch Coal, Inc./Magnum Coal Company have not been taken
into account in Patriot's negotiations with the UMWA and must be
in order to satisfy the requirements of Sections 1113;
(b) Patriot is not entitled to a windfall from litigation claims
against Peabody and/or Arch/Magnum to the detriment of its
employees, retirees and other affected parties, and
(c) Patriot's proposed implementation of management bonus
programs during these cases suggests that the proposed
modifications in the Proposals to the UMMA may not be "necessary"
to the Debtors' reorganization efforts, or fair and equitable.
Ohio Valley Coal is a creditor of the Debtor, Pine Ridge Coal
Company, and a participating employer in the UMWA 1974 Pension
Plan. On March 19, 2013, the Ohio Valley Coal Company acquired
Claim No. 2805 of Top Notch Custodial Care, Inc. According to
Ohio Valley Coal Company, Patriot and Magnum were "spun-off"
from Peabody and Arch for the purpose of isolating liabilities
into a company that could not survive in the long term.
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis & Frankel LLP serves as its counsel.
Houlihan Lokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
PENSON WORLDWIDE: To Sell to Caisses as No Other Bids Filed
-----------------------------------------------------------
Penson Worldwide, Inc. notified the U.S. Bankruptcy Court for the
District of Delaware on March 21, 2013, that it did not receive
any qualified bids other than the bid offered by Federation des
Caisses Desjardins du Quebec, the stalking horse bidder in the
proposed sale of substantially all of the assets related to the
direct access trading technology and online brokerage solutions of
Penson Worldwide and Nexa Technologies, Inc.
As a result, the auction that was scheduled for March 22, 2013,
has been cancelled.
The Debtors will present for approval Federation des Caisses' bid
at the Sale Hearing scheduled for March 26, 2013 at 9:30 a.m.
(ET).
At the hearing, the Court will also consider the objections
brought by various parties over the notice filed by the Debtors
which identifies those contracts which potentially may be assumed
and assigned in conjunction with the proposed sale transaction.
The objectors are Oracle America, Inc., Regions Equipment Finance,
Ltd. and Regions Equipment Finance Corporation, affiliates of
Verizon Communications Inc., Interactive Data Corporation, and
Zayo Group, LLC.
Oracle America, successor in interest to Oracle USA, Inc. and
Oracle Corporation, complained that based on the very general
description in the Assumption Notice, Oracle cannot, at this time,
determine the appropriate cure amount owed under the listed Oracle
agreement, or even whether it is executory. It reserves its
rights to object regarding the cure amount and the scope of the
proposed assumption and assignment until all Oracle contracts are
described by the Debtors with the requisite specificity to at
least allow for identification and analysis of any resulting cure
owed.
Regions said it is not necessarily opposed to the assumption and
assignment of its Master Agreement with the Debtors if the default
is cured and the purchaser specifically assumes the obligations
under the Master Agreement and equipment schedules. The amount to
cure Penson's default under the Master Agreement is $275,974.25.
The affiliates of Verizon Communications Inc. asserted that
Verizon does not object to the Debtors' assumption and assignment
of Verizon Contracts, however, the Notice identified only two
accounts, and Verizon has not located one of those accounts.
Verizon has also located 18 other accounts that are not identified
on the Assumption/Assignment Notice. Verizon wants to know whether
the Debtors intend to assume and assign the 18 accounts that were
not identified on the Notice, or whether those accounts should be
terminated immediately upon the sale of the Debtors' assets.
Verizon also objects to the $0.00 amount that the Notice indicates
as necessary to cure existing defaults. Verizon says the Debtors
must pay the sums -- totaling $13,616.61 for the prepetition
period and $7,611.49 for the postpetition period -- arising under
any of the assumed accounts that are unpaid as of the date of
assumption and assignment.
Interactive Data, a counterparty to a Global Services Agreement
with the Debtors, objects to the Debtors' attempt to assume and
assign Order Schedules without also assuming and assigning the
applicable Global Services Agreement. Interactive also objects to
the Debtors' understated proposed cure amounts for the Schedules
saying they may not assume the Schedules without curing defaults.
Zayo Group, successor by merger to AboveNet Communications, Inc.,
and a party to a Master Products and Services Agreement for
telecommunication services with the Debtors, argues that the
$0.00 cure amount set forth in the Notice does not comport with
the cure amount as shown on its books and records. Zayo says the
correct cure amount aggregates $46,403.78.
About Penson Worldwide
Plano, Texas-based Penson Worldwide Inc. and its affiliates filed
for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10061)
on Jan. 11, 2013.
Founded in 1995, Penson Worldwide is provider of a range of
critical securities and futures processing infrastructure products
and services to the global financial services industry. The
company's products and services include securities and futures
clearing and execution, financing and cash management technology
and other related offerings, and it provides tools and services to
support trading in multiple markets, asset classes and currencies.
Penson was one of the top two clearing brokers overall in the
United States. Its foreign-based subsidiaries were some of the
largest independent clearing brokers in Canada and Australia and
the second largest independent clearing broker in the United
Kingdom as of Dec. 31, 2010.
In 2012, the company sold its futures division to Knight Capital
Group Inc. and its broker-deal subsidiary to Apex Clearing Corp.
But the company was unable to successfully streamline is business
after the asset sales.
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, and
Young, Conaway, Stargatt & Taylor serve as counsel to the Debtors.
Mayer Brown LLP serves as their special counsel. Kurtzman Carson
Consultants LLC is the claims and notice agent.
The U.S. Trustee for Region 3 appointed three members to the
Official Committee of Unsecured Creditors: (i) Schonfeld Group
Holdings LLC; (ii) SunGard Financial Systems LLC; and (iii) Wells
Fargo Bank, N.A., as Indenture Trustee. The Committee selected
Hahn & Hessen LLP and Cousins Chipman & Brown, LLP to serve as its
co-counsel, and Capstone Advisory Group, LLC, as its financial
advisor. Kurtzman Carson Consultants LLC serves as its
information agent.
The company estimated $100 million to $500 million in assets and
liabilities in its Chapter 11 petition. The last publicly filed
financial statements as of June 30 showed assets of $1.17 billion
and liabilities totaling $1.227 billion.
PENSON WORLDWIDE: Grace Fin'l. Wants Stay Lifted to Pursue Claims
-----------------------------------------------------------------
Grace Financial Group LLC seeks relief from the automatic stay so
it may pursue to judgment or other resolution and liquidate its
claims against Penson Financial Services, Inc.
Grace Financial and the Debtor are parties to a Clearing Agreement
dated October 28, 2010, under which the Debtor processed
securities trades and provided related back-office clearing,
settlement and custodial services to Grace Financial's customers.
On May 30, 2012, the Debtor, in breach of the Clearing Agreement,
stopped providing clearing, settlement and custodial services in
foreign local market equities. As a result, Grace Financial filed
a statement of claim, an amended statement of claim and a second
amended statement of claim under the FINRA Code of Arbitration
Procedure for Industry Disputes against the Debtor on May 31,
2013.
The proceeding is styled Grace Financial Group LLC v. Penson
Financial Services, Inc. and Apex Clearing Corporation, FINRA No.
12-02002.
The FINRA Arbitration Proceeding is scheduled for October 1, 2013.
Grace Financial has asserted claims in excess of $10 million
against the Debtor due to, among other things, the Debtor's (a)
breach of the Clearing Agreement; (b) fraud and fraudulent
concealment; (c) reckless misconduct; (d) gross negligence,
negligence and negligent misrepresentation; (e) breaches of the
Debtor's covenant of good faith and fair dealing under the
Clearing Agreement; (f) breach of usual and customary practices in
securities and clearing broker industry; and (g) tortious
interference with Grace Financial's existing and prospective
business relationships and contracts; and (h) obligation to
indemnify Grace Financial under the Clearing Agreement.
The Court will consider the lift stay motion for approval on
April 16, 2013, at 9:30 a.m.
About Penson Worldwide
Plano, Texas-based Penson Worldwide Inc. and its affiliates filed
for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10061)
on Jan. 11, 2013.
Founded in 1995, Penson Worldwide is provider of a range of
critical securities and futures processing infrastructure products
and services to the global financial services industry. The
company's products and services include securities and futures
clearing and execution, financing and cash management technology
and other related offerings, and it provides tools and services to
support trading in multiple markets, asset classes and currencies.
Penson was one of the top two clearing brokers overall in the
United States. Its foreign-based subsidiaries were some of the
largest independent clearing brokers in Canada and Australia and
the second largest independent clearing broker in the United
Kingdom as of Dec. 31, 2010.
In 2012, the company sold its futures division to Knight Capital
Group Inc. and its broker-deal subsidiary to Apex Clearing Corp.
But the company was unable to successfully streamline is business
after the asset sales.
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, and
Young, Conaway, Stargatt & Taylor serve as counsel to the Debtors.
Mayer Brown LLP serves as their special counsel. Kurtzman Carson
Consultants LLC is the claims and notice agent.
The U.S. Trustee for Region 3 appointed three members to the
Official Committee of Unsecured Creditors: (i) Schonfeld Group
Holdings LLC; (ii) SunGard Financial Systems LLC; and (iii) Wells
Fargo Bank, N.A., as Indenture Trustee. The Committee selected
Hahn & Hessen LLP and Cousins Chipman & Brown, LLP to serve as its
co-counsel, and Capstone Advisory Group, LLC, as its financial
advisor. Kurtzman Carson Consultants LLC serves as its
information agent.
The company estimated $100 million to $500 million in assets and
liabilities in its Chapter 11 petition. The last publicly filed
financial statements as of June 30 showed assets of $1.17 billion
and liabilities totaling $1.227 billion.
PEREGRINE FINANCIAL: Court OKs Three Classes of Customers
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that, so the trustee of Peregrine Financial Group Inc. can
make progress toward distributions to customers, the bankruptcy
court in Chicago gave permission for creating three categories
into which customer accounts will be placed:
(1) The largest class consists of so-called 4d customers with
commodity futures and options accounts. Those customers had
$370 million in their accounts when the bankruptcy began.
Trustee Ira Bodenstein said in a court filing that
"malfeasance" at Peregrine led to a "significant shortfall"
in those accounts.
(2) Fortunate customers are those with so-called 30.7 accounts
for trading in futures or options on foreign exchanges. A
lawyer for the trustee said at the hearing they should be
paid in full. At the outset, there were $28 million in 30.7
accounts.
(3) The smallest category, with $5 million in accounts, is for
so-called delivery customers, where the securities were
specifically identifiable as belonging to them.
Approval given by the judge on March 20 didn't decide the
categories into which each customer belongs. That decision will
be made later in the process of fixing the amount of each
customer's claim. The Chapter 7 bankruptcy trustee will also
make separate applications when the time comes for making
distributions.
About Peregrine Financial
Peregrine Financial Group Inc. filed to liquidate under Chapter 7
of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 12-27488)
on July 10, 2012, disclosing between $500 million and $1 billion
of assets, and between $100 million and $500 million of
liabilities.
Earlier that day, at the behest of the U.S. Commodity Futures
Trading Commission, a U.S. district judge appointed a receiver and
froze the firm's assets. The firm put itself into bankruptcy
liquidation in Chicago later the same day. The CFTC had sued
Peregrine, saying that more than $200 million of supposedly
segregated customer funds had been "misappropriated." The CFTC
case is U.S. Commodity Futures Trading Commission v. Peregrine
Financial Group Inc., 12-cv-5383, U.S. District Court, Northern
District of Illinois (Chicago).
Peregrine's CEO Russell R. Wasendorf Sr. unsuccessfully attempted
suicide outside a firm office in Cedar Falls, Iowa, on July 9.
The bankruptcy petition was signed in his place by Russell R.
Wasendorf Jr., the firm's chief operating officer. The resolution
stated that Wasendorf Jr. was given a power of attorney on July 3
to exercise if Wasendorf Sr. became incapacitated.
Peregrine Financial is the regulated unit of the brokerage
PFGBest.
PLYMOUTH OIL: Hearing on Further Access to Cash on March 27
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Iowa
authorized Plymouth Oil Company, LLC, to continue to use cash
collateral of Ryan Lake, Steve Vande Brake, Arlon Sandbulte, Dirk
Dorn, and Iowa Corn Opportunities, LLC (the "Bridge Lenders"), and
of Iowa Prairie Bank, Iowa Corn Processors, LC, and FWS Industrial
Projects, USA Inc., through and including March 27, 2013.
The Debtor will be permitted to use Cash Collateral so long as the
Secured Creditors receive adequate protection in the form of the
Replacement Liens, the Adequate Protection Claims, the payments
made by the Debtor, and the other accommodations described in the
order and in the Motion.
A hearing on the Debtor's request for continued authority to use
cash collateral beyond March 27, 2013, is set on March 27, 2012,
at 1:30 p.m.
A copy of the cash collateral order is available at:
http://bankrupt.com/misc/plymouthoil.doc117.pdf
A copy of the cash collateral motion is available at:
http://bankrupt.com/misc/plymouthoil.doc109.pdf
Plymouth Oil Company, LLC, filed a bare-bones Chapter 11 petition
(Bankr. N.D. Iowa Case No. 12-01403) in Sioux City on July 23,
2012. In its amended schedules, the Debtor disclosed $21,623,349
in total assets and $12,891,586 in total liabilities.
Plymouth Oil -- http://www.plymouthoil.com-- has a $30 million
extraction plant located at 22058 K-42 Merrill, Iowa, directly
across from the new Plymouth Energy Ethanol Plant.
Founded by local investors, Plymouth Oil Company, LLC started
operations in February 2010 purchasing raw corn germ and refining
this material into de-oiled germ meal and kosher food-grade
cooking oil. The plant has the capability of pumping out 90 tons
of corn oil each day and about 300 tons of DCGM (defatted corn
germ meal) daily, which is used for hog, poultry and dairy feed.
Bankruptcy Judge Thad J. Collins presides over the case. Bradley
R. Kruse, Esq., at Brown Winick Graves Gross Baskerville &
Schoenebaum, P.L.C., serves as the Debtor's counsel. The petition
was signed by David P. Hoffman, president.
Secured creditors Arlon Sandbulte, Ryan Lake, Dirk Dorn, Steven
Vande Brake, and Iowa Corn Opportunities, LLC, are represented by
lawyers at Baird Holm LLP in Omaha, Nebraska.
PONCE DE LEON: PRLP Has Until Today to File Plan Stipulation
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico granted
PRLP 2001 Holdings LLC's request for an additional extension of 7
days, or until March 25, 2013, for it and the Debtor to submit a
stipulation on confirmation of Ponce De Leon 1403, Inc.'s plan or
reorganization. The Debtor requested an extension of time until
March 18 to file the stipulation which extension of time was
granted by the Court.
PRLP informs the Court that together with Debtor, it is in the
process of drafting a stipulation for filing with the Court but
the same has not been concluded. Therefore, PRLP and the Debtor
will require an extension until March 25, 2013, to finalize
negotiations and file the corresponding stipulation.
PRLP had objected to the Debtor's Plan, citing that the Plan
should not be confirmed as it suffers from various deficiencies
pursuant to Section 1129 of the Bankruptcy Code.
PRLP said the Plan is not feasible due to, among other things, the
fact that the treatment provided to creditors in the Plan is
inconsistent with the most recent Appraisal Report prepared by
Luis E. Vallejo of Vallejo & Vallejo Real Estate Appraisers and
Counselors. "Specifically, the feasibility of the Plan is put
into question inasmuch as the proposed Scenario A is predicated
upon Debtor entering into an agreement with PRLP (which agreement
has not materialized to date), as well as is based on expected
sales of certain Residential and Commercial Units for which no
historical sales support exists.
"Furthermore, the Plan cannot be confirmed under the proposed
Scenario B treatment as the same is insufficiently funded as to
those creditors in Classes 3 and 4 of the Plan, as well as
attempts to improvidently modify and expunge PRLP's collateral,
guarantees and security interests therein.
"PRLP will show that the Plan, as proposed, is patently
unconfirmable in light of the fact that the Plan will not offer
creditors more than they would receive under a liquidation
scenario, the fact that Debtor has improper and improvidently
precluded PRLP from participating in the General Unsecured
Creditors Class to collect on their Deficiency Claim, particularly
when considering that the value of the Metro Plaza properties will
not be sufficient to cover PRLP's indebtedness in full.
"Debtor's Plan has also been proposed in bad faith as it created a
separate classification of creditors for the sole and exclusive
purpose of "gerrymandering" the acceptance of one (1) impaired
Class for purposes of forcing a cramdown confirmation pursuant to
Sections 1129(a)(10) and (b) of the Code. As such, Debtor's Plan
is patently unconfirmable and PRLP respectfully requests that the
Court deny confirmation of the Plan."
According to papers filed with the Court, Debtor and Banco Popular
de Puerto Rico, now PRLP, entered into a Financing Agreement on
Sept. 27, 2005 in the amount of $45 million, which loan was
utilized for the construction of one hundred fifty (150) apartment
units, three commercial space and a commercial parking garage
located at 1403 Ponce de Leon Avenue, intersection Villamil
Street, Stop 19, Santurce, Puerto Rico (the "Project" or the
"Metro Plaza Property" or the "Collateral").
A copy of PRLP's objection to confirmation of Ponce De Leon 1403,
Inc.'s Jan. 25, 2013 Amended Plan of Reorganization is available
at http://bankrupt.com/misc/poncedeleon1403.doc194.pdf
Pursuant to the Debtor's Jan. 25, 2013 Amended Plan, PRLP
submitted a proof of claim against the Debtor for $14,496,907.
According to the Debtor, the outstanding obligation to PRLP has
been reduced to approximately $10.1 million. The Debtor will
treat this obligation to PRLP under two (2) Scenarios.
Under Scenario A, the preferred scenario by the Debtor, the Debtor
will retain the property and PRLP will retain the liens securing
its claims. On account of such claim PRLP will receive deferred
cash payments totaling the full amount of its claim, of a value as
of the effective date of the Plan estimated in $10.1 million
approx. within 36 months. The treatment will continue the sale of
the unsold units for a term of 36 months with a mutually
satisfactory budget for the use of the cash collateral and a
strong and well-planned marketing strategy and lease program to be
agreed upon with the secured creditor, before the confirmation
hearing.
Under Scenario B, the Debtor will surrender to PRLP property of
the estate equal in value or equivalent to the value of PRLP's
secured claim as of the confirmation date. This property will be
the remaining residential units at Metro Plaza Towers Condominium
project, the commercial spaces and parking spaces.
A copy of the Amended Plan is available at:
http://bankrupt.com/misc/poncedeleon1403.doc177.pdf
About Ponce De Leon
San Juan, P.R.-based Ponce De Leon 1403, Inc., developed,
constructed, and operates the Metro Plaza Tower condominium and
commercial property project in Santurce, Puerto Rico. The Metro
Plaza Tower project consists of two 15-story towers atop a base
structure that serves as a parking garage, common area, and retail
space. Each tower houses 87 residential units. The base
structure provides approximately 567 parking spaces and has
approximately 14,000 square feet of commercial space available for
lease. The common areas of the project include a swimming pool, a
gym, gardens and a gazebo.
Ponce De Leon 1403 Inc. filed for Chapter 11 protection (Bank. D.
P.R. Case No. 11-07920) on Sept. 19, 2011. The Debtor estimated
both assets and debts of between US$10 million and US$50 million.
Carmen Conde Torres, Esq., at C. Conde & Assoc., in Old San Juan,
Puerto Rico, represents the Debtor as counsel.
POWELL STEEL: Has Court OK to Use Cash Collateral Until March 31
----------------------------------------------------------------
The Hon. Magdeline D. Coleman of the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania entered a second interim order
granting Powell Steel Corporation authorization to use cash
collateral through March 31, 2013.
On Feb. 22, 2013, the Court entered its first interim order
authorizing the Debtor to access cash collateral until March 1,
2013. The Debtor sought court approval to use cash collateral to
pay outstanding and ongoing payroll obligations so operations can
continue on an uninterrupted basis.
M&T Bank has asserted a secured claim against the Debtor in the
approximate principal amount of $3.10 million as of Petition Date.
The Lender has asserted, and the Debtor has acknowledged that the
Lender has, as of the Petition Date, a valid and subsisting first
lien and security interest in the collateral. The Debtor
acknowledges and agrees that the collateral description is
intended to cover all assets of the Debtor.
The Debtor does not have sufficient unencumbered cash or other
assets with which to continue to operate its business in Chapter
11. The Debtor requires the immediate authority to use cash
collateral to continue its business operations without
interruption toward the objective of formulating an effective plan
of reorganization.
The Debtor is authorized to use cash collateral to meet the
ordinary cash needs of the Debtor for the payment of actual
expenses of the Debtor necessary to (a) maintain and preserve its
assets, and (b) continue operation of its business, including
payroll and payroll taxes, and insurance expenses as reflected in
the Cash Collateral Budget, a copy of which is available for free
at http://bankrupt.com/misc/POWELL_STEEL_cashcollbudget.pdf
As adequate protection, the Lender is granted a replacement
perfected security interest to the extent the Lender's cash
collateral is used by the Debtor, to the extent and with the same
priority in the Debtor's post-petition collateral, and proceeds
thereof, that the Lender held in the Debtor's pre-petition
collateral.
As a condition to the use of cash collateral, the Debtor will
close its current debtor-in-possession account at Fulton Bank and
will set up and transfer all funds into a debtor-in-possession
account at M&T Bank.
The Court has set a meeting for April 10, 2013, at 11:00 a.m. On
the Debtor's cash collateral use.
About Powell Steel
Powell Steel Corporation, located in Lancaster, Pennsylvania, is a
progressive structural steel fabricator and erector equipped with
state-of-the-art fabrication and welding equipment. Powell has a
67,000 square foot facility capable of fabricating in excess of
300 tons of steel per week. It has 50 employees working in the
fabrication facility and 23 employees providing erection services.
The business generates $1.2 million per month in revenue.
Powell Steel filed a Chapter 11 petition (Bankr. E.D. Pa. Case No.
13-11275) in Philadelphia on Feb. 13, 2013, estimating at least
$10 million in assets and liabilities.
PRESSURE BIOSCIENCES: CSS Discloses 3% Equity Stake at Dec. 31
--------------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, CSS, LLC, and its affiliate disclosed that,
as of Dec. 31, 2012, they beneficially own 401,935 shares of
common stock of Pressure BioSciences, Inc., representing 3.4% of
the shares outstanding. A copy of the filing is available for
free at http://is.gd/IJPhL3
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.
PRECISION OPTICS: Amends Dec. 31 Form 10-Q in XBRL Format
---------------------------------------------------------
Precision Optics Corporation, Inc., filed with the U.S. Securities
and Exchange Commission an amended quarterly report for the period
ended Dec. 31, 2012, originally filed with the SEC on Feb. 14,
2013, to furnish the interactive data files as required by Rule
405 of Regulation S-T.
No other changes have been made to the Form 10-Q, and the
Amendment No. 1 does not amend, update or change any other items
or disclosure found in the Form 10-Q. Further, the Amendment No.
1 does not reflect subsequent events occurring after the original
filing date of the Form 10-Q or modify or update in any way
disclosures made in the Form 10-Q.
A copy of the amended Form 10-Q is available for free at:
http://is.gd/jMEo0o
About Precision Optics
Headquartered in Gardner, Massachusetts, Precision Optics
Corporation, Inc., has been a developer and manufacturer of
advanced optical instruments since 1982. The Company designs and
produces high-quality micro-optics, medical instruments and other
advanced optical systems. The Company's medical instrumentation
line includes laparoscopes, arthroscopes and endocouplers and a
world-class product line of 3-D endoscopes for use in minimally
invasive surgical procedures.
The Company reported net income of $960,972 on $2.15 million of
revenue for the year ended June 30, 2012, compared with a net loss
of $1.05 million on $2.24 million of revenue during the prior
fiscal year.
The Company's balance sheet at Sept. 30, 2012, showed
$3.38 million in total assets, $984,227 in total liabilities, all
current, and $2.40 million in total stockholders' equity.
QUICK-MED TECHNOLOGIES: Delays Form 10-Q for Dec. 31 Quarter
------------------------------------------------------------
Quick-Med Technologies Inc. was unable to file its quarterly
report on Form 10-Q for the year ended Dec. 31, 2012, within the
prescribed time period because the Company does not yet have all
the documentation to complete the Form 10-Q.
About Quick-Med
Gainesville, Fla.-based Quick-Med Technologies, Inc., is a life
sciences company focused on developing proprietary, broad-based
technologies in the consumer and healthcare markets. Its four
core technologies are: (1) Novel Intrinsically Micro-Bonded
Utility Substrate (NIMBUS(R)), a family of advanced polymers bio-
engineered to have antimicrobial, hemostatic, and other properties
that can be used in a wide range of applications, including wound
care, catheters, tubing, films, and coatings; (2) Stay Fresh(R), a
novel antimicrobial based on sequestered hydrogen peroxide, that
can provide durable antimicrobial protection to items such as
textiles through numerous laundering cycles; (3) NimbuDerm(TM), a
novel copolymer for application as a persistent hand sanitizer
with long lasting protection against germs; and (4) MultiStat(R),
a family of advanced patented methods and compounds shown to be
effective in skin therapy applications.
The Company's balance sheet at Sept. 30, 2012, showed $1.4 million
in total assets, $9.8 million in total liabilities, and a
stockholders' deficit of $8.4 million.
Daszkal Bolton LLP, in Boca Raton, Florida, expressed substantial
doubt about Quick-Med's ability to continue as a going concern.
The independent auditors noted the the Company has experienced
recurring losses and negative cash flows from operations for the
years ended June 30, 2012, and 2011, and has a net capital
deficiency.
RADIAN GUARANTY: Unit Enters Into Partnership with Optimal Blue
---------------------------------------------------------------
Radian Guaranty Inc., the mortgage insurance (MI) subsidiary of
Radian Group Inc., on March 21 announced a partnership with
Optimal Blue, award-winning provider of the industry-leading,
enterprise level, end-to-end product, pricing and secondary
marketing automation platform. Through this partnership, pricing
for Radian MI is available within the Optimal Blue workflow
platform. This partnership enhances and simplifies the MI rate
quote, and eventually the ordering process, for both Radian and
Optimal Blue customers, enabling them to receive an instant
estimate or a detailed rate quote in real time within Optimal
Blue.
"Radian is proud to partner with an industry leader like Optimal
Blue," stated Brien McMahon, chief franchise officer for Radian.
"Optimal Blue has a strong history as a top loan enterprise
pricing and secondary marketing platform. In fact, many current
Radian customers utilize Optimal Blue's platform to originate
business. By integrating our pricing, we're making doing business
with Radian quick and simple."
"Our integration with Radian is a clear win-win for both Optimal
Blue and Radian customers as it simplifies the rate quote process
for them," said Larry Huff, Co-CEO of Optimal Blue. "This
integration is in keeping with our philosophy of unified workflow,
not just simple data transfer. With MI rate quote functionality
embedded within Optimal Blue, the user doesn't have to move
between two systems. Both companies share the objective of
streamlining the loan process, and together we're taking a step to
make that happen. We count this as the first step in a long and
successful partnership with Radian."
Founded in 2002, Optimal Blue -- http://www.optimalblue.com-- is
a Web-based provider of product eligibility and pricing engine
(PPE) technology. The company is based in Plano, Texas.
About Radian Group
Headquartered in Philadelphia, Radian Group Inc. --
http://www.radian.biz-- provides private mortgage insurance and
related risk mitigation products and services to mortgage lenders
nationwide through its principal operating subsidiary, Radian
Guaranty Inc. These services help promote and preserve
homeownership opportunities for homebuyers, while protecting
lenders from default-related losses on residential first mortgages
and facilitating the sale of low-downpayment mortgages in the
secondary market.
* * *
As reported by the Troubled Company Reporter on March 4, 2013,
Standard & Poor's Ratings Services said that it has affirmed all
of its ratings on Radian Group Inc. At the same time, S&P revised
the outlook to stable from negative. S&P also assigned its 'CCC+'
senior unsecured debt rating to the company's proposed
$350 million convertible senior notes.
As reported by the Troubled Company Reporter on Oct. 17, 2012,
Standard & Poor's Rating Services raised its long-term issuer
credit ratings on Radian Group Inc. (RDN) to 'CCC+' from 'CCC-'
and MGIC Investment Corp. (MTG) to 'CCC+' from 'CCC'. The
financial strength ratings for both RDN's and MTG's respective
operating companies are unchanged. The outlook on both companies
is negative.
"The outlook for each company is negative, reflecting the
continuing risk of significant adverse reserve development; the
current trajectory of operating performance; and the expected
impact ongoing losses will have on their capital positions," S&P
said in October 2012. "We expect operating performance to
deteriorate for the rest of the year for both companies,
reflecting the affect of normal adverse seasonality on new notices
of delinquency and cure rates, and the lack of greater improvement
in the job markets."
READER'S DIGEST: Files Plan; Unsecured Recovery Left Blank
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Reader's Digest Association filed a definitive
reorganization plan to carry out the agreement negotiated before
the Chapter 11 filing on Feb. 17 with holders of 70% of what
amounts to $464.4 million in second-lien floating-rate notes.
The plan is designed to reduce debt by 80% from conversion of $231
million of the notes into the new equity. All together, $475
million of debt will be converted to equity under the plan. Other
debt to become equity includes the $45 million in fresh cash being
supplied to the company by some of the noteholders as financing
for the Chapter 11 effort.
The noteholders' deficiency claim of $244.9 million will be
treated as a general unsecured claim. The universe of unsecured
claims is expected to be $380 million.
Several significant provisions in the Disclosure Statement,
including the estimated recovery by unsecured creditors, were left
blank. What the percentage recovery by unsecured creditors will
be or the form it will take is yet to be negotiated, resulting in
blanks appearing in papers filed March 21.
The hearing for approval of the disclosure statement is set for
April 25. Creditors can only vote after disclosure documents
receive a blessing from the judge.
The report also relates that at a hearing March 21, the bankruptcy
judge said he will approve $105 million in financing for the
bankruptcy. The loan includes the $45 million of fresh cash, with
the remainder representing refinancing of existing secured debt.
About Reader's Digest
Reader's Digest is a global media and direct marketing company
that educates, entertains and connects consumers around the world
with products and services from trusted brands. For more than 90
years, the flagship brand and the world's most read magazine,
Reader's Digest, has simplified and enriched consumers' lives by
discovering and expertly selecting the most interesting ideas,
stories, experiences and products in health, home, family,
food, finance and humor.
RDA Holding Co. and 30 affiliates (Bankr. S.D.N.Y. Lead Case No.
13-22233) filed for Chapter 11 protection on Feb. 17, 2013 with an
agreement with major stakeholders for a pre-negotiated chapter 11
restructuring. Under the plan, the Debtor will issue the new stock
to holders of senior secured notes.
RDA Holding Co. listed total assets of $1,118,400,000 and total
liabilities of $1,184,500,000 as of the Petition Date.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Evercore Group LLC is the investment banker. Epiq
Bankruptcy Solutions LLC is the claims and notice agent.
Reader's Digest, together with its 47 affiliates, first sought
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 09-23529) Aug. 24,
2009 and exited bankruptcy Feb. 19, 2010.
READER'S DIGEST: Creditors Committee Seeks Changes in Loan
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that a hearing March 21, the bankruptcy judge said he will
approve $105 million in financing for the bankruptcy of Reader's
Digest. The loan includes the $45 million of fresh cash, with the
remainder representing refinancing of existing secured debt.
Reader's Digest 's request for final approval of a $105 million
loan faced opposition from the official creditors' committee with
respect to the proposal to give liens to the lenders secured by
lawsuit recoveries.
According to the report, the committee says that lawsuits could be
the only means for recovery by unsecured creditors. The loan
gives lenders complete control of the bankruptcy, according to the
committee. The committee doesn't object to giving liens on
lawsuits so long as the lenders are required to collect first from
other collateral.
The loan will give RDA $45 million in new borrowing power. The
remainder of the loan represents refinancing of a pre-bankruptcy
debt.
RDA filed for reorganization in February with a plan to reduce
debt 80% by converting $465 million of second-lien, floating-rate
notes into the new stock. The committee pointed out in a court
filing March 20 that the recovery by unsecured creditors under the
plan isn't yet decided by holders of 70% of what amounts to
second-lien floating-rate notes who developed the plan.
The $522.6 million in floating-rate notes last traded on Feb. 20
for 34 cents on the dollar, according to Trace, the bond-price
reporting system of the Financial Industry Regulatory Authority.
About Reader's Digest
Reader's Digest is a global media and direct marketing company
that educates, entertains and connects consumers around the world
with products and services from trusted brands. For more than 90
years, the flagship brand and the world's most read magazine,
Reader's Digest, has simplified and enriched consumers' lives by
discovering and expertly selecting the most interesting ideas,
stories, experiences and products in health, home, family,
food, finance and humor.
RDA Holding Co. and 30 affiliates (Bankr. S.D.N.Y. Lead Case No.
13-22233) filed for Chapter 11 protection on Feb. 17, 2013 with an
agreement with major stakeholders for a pre-negotiated chapter 11
restructuring. Under the plan, the Debtor will issue the new stock
to holders of senior secured notes.
RDA Holding Co. listed total assets of $1,118,400,000 and total
liabilities of $1,184,500,000 as of the Petition Date.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Evercore Group LLC is the investment banker. Epiq
Bankruptcy Solutions LLC is the claims and notice agent.
Reader's Digest, together with its 47 affiliates, first sought
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 09-23529) Aug. 24,
2009 and exited bankruptcy Feb. 19, 2010.
READER'S DIGEST: New Money Lenders Defend DIP Financing Terms
-------------------------------------------------------------
In the Chapter 11 cases of Reader's Digest, the so-called New
Money Lenders, a subset of the DIP Lenders, and the Ad Hoc
Committee of Prepetition Secured Noteholders, have filed a reply
to the objection of the Committee of Unsecured Creditors to the
motion of RDA Holding Co. and its affiliates to access DIP
Financing.
Nicole L. Greenblatt, Esq., representing the New Money Lenders,
tells the Court that the sole issue raised in the Committee
Objection is whether the New Money Lenders must agree to look last
to previously unencumbered collateral in satisfying their DIP
Facility claims. The Committee's objection must be overruled as
there is no basis under the Bankruptcy Code or applicable case law
-- particularly under the facts and circumstances of Reader's
Digest's chapter 11 cases -- to require any such marshaling with
respect to the DIP Liens granted to the New Money Lenders or the
adequate protection liens granted to the Primed Noteholders under
the proposed Final DIP Order.
Mr. Greenblatt states that the Primed Noteholders, who enjoyed a
secured position at the top of the Debtors' capital structure on a
prepetition basis, are expected to have an unsecured deficiency
claim of several hundred million dollars based on the value of the
Debtors' enterprise. To minimize further impairment to their
prepetition collateral, the New Money Lenders are providing $45
million in new money through a priming, post-petition financing
facility to preserve the value of these estates for the benefit of
all creditors -- but are priming their prepetition position to the
minimum extent necessary. It is, therefore, wholly appropriate
for the proposed Final DIP Order to provide for DIP Liens and
Adequate Protection Liens in property that comes into existence
solely by virtue of the commencement of these Chapter 11 Cases and
that such liens be free of any marshaling requirement. The terms
and conditions of the DIP Facility and all of the liens granted in
connection therewith were heavily negotiated and served as a
material inducement for the New Money Lenders to provide post-
petition financing. Importantly, no other party has agreed to
provide post-petition financing on more favorable terms.
As the largest unsecured creditors in these chapter 11 cases, Ms.
Greenblatt submits that it is undisputed that the prosecution of
avoidance actions will be primarily for the benefit of the Primed
Noteholders -- and the Primed Noteholders have every incentive to
maximize their recovery in these chapter 11 cases.
Notwithstanding these circumstances, the New Money Lenders have
engaged in weeks of good faith and arms-length negotiations with
the Committee in an effort to reach a global settlement on the
proposed Final DIP Order -- and have expressly agreed to take
liens only on the proceeds of avoidance actions and not on the
underlying actions themselves. Moreover, although the Debtors'
general unsecured creditors may not be entitled to any
distribution in these cases based on enterprise value, the New
Money Lenders intend to commence settlement negotiations with the
Committee as part of the Plan confirmation process -- and those
negotiations are likely to address treatment of avoidance actions.
The New Money Lenders will not, however, provide a gift to
unsecured creditors through marshaling language in the Final DIP
Order, which is what the Committee is seeking.
Ms. Greenblatt points out that there is no provision of the
Bankruptcy Code or case law that requires a postpetition lender to
submit to the marshaling requirement demanded by the Committee.
Not surprisingly, the Committee fails to cite any precedential
authority to support their position that a post-petition lender
must agree to marshaling because such authority does not exist.
Instead the Committee cites inapplicable and questionable case law
from the 3rd Circuit and districts other than the S.D.N.Y. for the
general positions that (a) avoidance actions should be preserved
for unsecured creditors, (b) avoidance actions are not a debtor's
property and (c) certain courts in other districts restrict
pledges of avoidance actions as security for post-petition
financing. These are inapplicable here given that the New Money
Lenders and the Primed Noteholders have already agreed to take
liens on the proceeds of avoidance actions and not the actions
themselves, an approved position in the Second Circuit.
About Reader's Digest
Reader's Digest is a global media and direct marketing company
that educates, entertains and connects consumers around the world
with products and services from trusted brands. For more than 90
years, the flagship brand and the world's most read magazine,
Reader's Digest, has simplified and enriched consumers' lives by
discovering and expertly selecting the most interesting ideas,
stories, experiences and products in health, home, family,
food, finance and humor.
RDA Holding Co. and 30 affiliates (Bankr. S.D.N.Y. Lead Case No.
13-22233) filed for Chapter 11 protection on Feb. 17, 2013 with an
agreement with major stakeholders for a pre-negotiated chapter 11
restructuring. Under the plan, the Debtor will issue the new stock
to holders of senior secured notes.
RDA Holding Co. listed total assets of $1,118,400,000 and total
liabilities of $1,184,500,000 as of the Petition Date.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Evercore Group LLC is the investment banker. Epiq
Bankruptcy Solutions LLC is the claims and notice agent.
Reader's Digest, together with its 47 affiliates, first sought
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 09-23529) Aug. 24,
2009 and exited bankruptcy Feb. 19, 2010.
READER'S DIGEST: Committee Wants to Hire Otterbourg as Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of RDA Holding Co.,
et al., asks the Bankruptcy Court for order authorizing the
retention of Otterbourg, Steindler, Houston & Rosen, P.C., as its
counsel, effective as of February 28, 2013.
Otterbourg will charge for its legal services on an hourly basis
in accordance with its ordinary and customary hourly rates and for
its actual out-of-pocket disbursements incurred. The range of
hourly rates currently charged by OSH&R is:
Partner/Counsel $550 - $940
Associate $265 - $645
Paralegal $235 - $250
Scott L. Hazan, Esq., a member of Otterbourg, Steindler, Houston &
Rosen, P.C., assures the Court that his firm is a "disinterested
person" as defined in Section 101(14) of the Bankruptcy Code.
About Reader's Digest
Reader's Digest is a global media and direct marketing company
that educates, entertains and connects consumers around the world
with products and services from trusted brands. For more than 90
years, the flagship brand and the world's most read magazine,
Reader's Digest, has simplified and enriched consumers' lives by
discovering and expertly selecting the most interesting ideas,
stories, experiences and products in health, home, family,
food, finance and humor.
RDA Holding Co. and 30 affiliates (Bankr. S.D.N.Y. Lead Case No.
13-22233) filed for Chapter 11 protection on Feb. 17, 2013 with an
agreement with major stakeholders for a pre-negotiated chapter 11
restructuring. Under the plan, the Debtor will issue the new stock
to holders of senior secured notes.
RDA Holding Co. listed total assets of $1,118,400,000 and total
liabilities of $1,184,500,000 as of the Petition Date.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Evercore Group LLC is the investment banker. Epiq
Bankruptcy Solutions LLC is the claims and notice agent.
Reader's Digest, together with its 47 affiliates, first sought
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 09-23529) Aug. 24,
2009 and exited bankruptcy Feb. 19, 2010.
REID PARK: Files Non-Material Modifications to Fifth Amended Plan
-----------------------------------------------------------------
Reid Park Properties, LLC, filed on Feb. 25, 2013, a proposed Non
Material Modification to its Fifth Amended and Modified Plan of
Reorganization, filed on Feb. 8, 2012. The Debtor modifies its
Plan as follows: HSL Properties, Inc., will guarantee the terms
and conditions of payment as set forth in Class 5 in Debtor's Plan
of Reorganization as Modified on a commercially reasonable form of
guaranty. The first sentence of the top of page 25 of the Plan is
amended and restated as follows: "HSL Properties, Inc., shall
reasonably agree with Lender on a from of guaranty of the Class 5
Allowed Secured Claim."
As reported in the TCR on March 20, 2013, Secured Lender WBCMT
2007-C31 South Alvernon Way, LLC, further amended its proposed
plan for the orderly liquidation of Reid Park Properties, LLC, to
leave its secured claim and the class of general unsecured claims
impaired.
Under the Secured Lender's second amended modifications to its
First Amended Plan of Reorganization, the Debtor will convey the
Doubletree Hotel Tucson at Reid Park located at 445 South Alvernon
Way, in Tucson, Arizona, and all related personal property to the
Plan Transferee. The Secured Lender's Secured Claim will not be
discharged, but will be assumed by the Plan Transferee on the
Effective Date. The Plan Transferee will take title to the Hotel
and all related personal property subject to the Allowed Lender
Secured Claim and will arrange for a professional hotel management
company to continue operating the Hotel as a DoubleTree.
In a separate court filing, the Secured Lender maintains that its
Plan proposes a better alternative for creditors than the Debtor's
Fifth Amended Plan of Reorganization because its Plan provides a
substantial 25% distribution to general unsecured creditors.
About Reid Park Properties
Reid Park Properties LLC is the owner of the Doubletree Hotel
Tucson located in South Alernon Way in Tucson, Arizona. The nine-
story property has 287 rooms. It was purchased for $31.8 million
in 2007 by an affiliate of Transwest Properties Inc.
Reid Park filed a Chapter 11 petition (Bankr. D. Ariz. Case No.
11-15267) on May 26, 2011. According to its bankruptcy petition,
Reid Park has $52 million in liabilities and $14 million in
assets. The Law Offices of Eric Slocum Sparks, P.C., serves as
its legal counsel.
The U.S. Trustee Christopher Pattock said that an official
committee of unsecured creditors has not been appointed because an
insufficient number of persons holding unsecured claims against
the Debtor have expressed interest in serving on a committee.
RESIDENTIAL CAPITAL: Stopped From Junking Mortgage Consent Decree
-----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Federal Reserve Board won a victory in bankruptcy
court on March 21 over Residential Capital LLC, the mortgage-
servicing subsidiary of non-bankrupt Ally Financial Inc.
According to the Fed and Ally, ResCap was attempting to scuttle a
consent decree by calling the obligation to hunt for foreclosure
abuses a "claim" that could be paid in cash like other unsecured
claims.
The Fed and Ally both took the position that a bankruptcy court
has no power to modify a consent decree with ResCap's primary
government regulator. They prevailed when the bankruptcy judge
said he wouldn't rule and told ResCap to renegotiate with the Fed.
Separately, ResCap is proposing new bonus programs for about 160
executives and employees, according to the report.
With the sale of most of the businesses, the buyers took about
3,400 of ResCap's 3,800 workers. For the time being, ResCap is
intending to retain about 260 workers and executives. To ensure
that 155 valued non-executive employees don't leave prematurely,
ResCap is proposing a $4.4 million bonus program up for approval
at an April 11 hearing. ResCap is prosing incentive bonuses for
six executives that would cost $2.2 million. Payments are keyed to
success in liquidating the remaining $1.6 billion in assets. The
two top officers are to have separate incentive bonuses for work
they perform before leaving ResCap between April and June.
ResCap also settled a claim against a former mortgage originator.
ResCap settled the remaining claims it has against People's Choice
Financial Corp., a former subprime mortgage originator that won
approval of a liquidating Chapter 11 plan in August 2008. ResCap
originally had a $262 million secured claim against People's
Choice arising from a so-called warehouse loan agreement. The
sale of mortgages generated cash to pay down the warehouse
facility, leaving ResCap to assert a claim of almost $90 million
to be dealt with by the plan. ResCap and the trustee liquidating
People's Choice reached a settlement where ResCap will have
approved unsecured claims for about $65 million, to be paid the
same as other unsecured creditors.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Facing creditor criticism, ResCap terminated the prebankruptcy
agreement with Ally intended as the foundation for a Chapter 11
plan. ResCap is also giving creditors the right to sue Ally if
there isn't agreement on a consensual plan by May, when an
examiner will be issuing a report.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Ally Expense Allocation Talks Until April 18
-----------------------------------------------------------------
The Bankruptcy Court approved a third stipulation between
Residential Capital LLC and Ally Financial, Inc., under which they
agreed to continue to negotiate in good faith to enter in an
agreement by April 18, 2013, on a revised expense allocation
methodology that will become effective following April 18.
The stipulation also amends the AFI DIP and Cash Collateral Order
to provide that the Borrowers' right to use Prepetition
Collateral, including Cash Collateral, will automatically
terminate without further notice or order of the Court (i) on the
effective date of a Plan for any Debtor, (ii) April 18, 2013, or
(iii) upon written notice by the AFI Lender to the Borrowers after
the occurrence and during the continuance of any termination
events.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Has Protocol for Challenging 6,400 Claims
--------------------------------------------------------------
Residential Capital LLC and its affiliates seek the Bankruptcy
Court's authority to establish procedures for claims objection,
borrower claims, claims settlement, and for amending their
schedules of assets and liabilities in order for to expedite the
process of reconciling more than 6,400 filed claims and more than
1,000 scheduled claims, and reduce their administrative burden
imposed on the Court and their estates.
The Debtors propose to file a single omnibus objection to no more
than 150 claims at a time seeking reduction, reclassification and
disallowance of claims on numerous grounds. To reduce service
costs, the Debtors will serve a notice of the omnibus claims
objection on each claimant whose claims are subject of the
applicable omnibus claims objection. Parties will have at least
21 days after the mailing of the omnibus claims objection notice
to respond to the claims objection.
The Debtors propose to serve an omnibus claims objection
exclusively addressing claims filed by current or former
borrowers. The Debtors estimate that there are at least 2,800
Borrower Claims. The Debtors also propose to offer settlement to
a Borrower as to the allowed amount of the Borrower Claim. The
Debtors propose to settle without prior court approval of any
Borrower Claim provided that the amount to be allowed for the
claim does not exceed $50,000. For claims settlement whose
aggregate amount to be allowed for an individual Borrower Claim
exceeds $50,000 but is less than $250,000, the Debtors will submit
the proposed settlement to the Official Committee of Unsecured
Creditors for approval. If the proposed settlement of a Borrower
Claim exceeds $250,000, the Debtors will seek Court approval of
such settlement. If a Borrower rejects, or does not accept, the
offer within 14 days after being offered, then the Debtors may
include that claim in an omnibus claims objection.
The Debtors also propose to settlement claims, other than the
Borrowers Claims. The Debtors propose to settle claims without
prior court approval for those whose aggregate amount to be
allowed for an individual claim is less than or equal to $500,000.
If the settlement amount is $1 million or less, but the claimant
with whom the Debtors wish to settle is an insider, the Debtors
will seek court approval of such settlement. If the settlement
amount is not a de minimis amount but is to be allowed either as a
prepetition general unsecured nonpriority claim less than $15
million or a secured claim, an administrative claim, or a priority
claim greater than $50,000 but less than $250,000 then the Debtors
will submit the proposed settlement with the Creditors' Committee
and ask for court approval of such settlement.
The Debtors also propose to amend their schedules as they
anticipate that, as the claims reconciliation process proceeds,
they will discover discrepancies in the Schedules, including the
listing of various liabilities that exceed what they actually owe.
The Debtors propose to serve Omnibus Amendment Motions on all
affected claimants and their counsel. The Claimant as to whose
Scheduled Claims the Debtors eek to amend will be required to
respond not more than 21 days after the motion is filed and
served.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: FTI Rollover Provision Extended
----------------------------------------------------
Residential Capital LLC and its affiliates ask the Bankruptcy
Court to approve a third addendum to their engagement agreement
with FTI Consulting, Inc., the Debtors' financial advisor. The
Third Addendum modifies the Engagement Letter to extend the
expiration of the "rollover provision" through and including the
effective date of a confirmed plan in the Debtors' Chapter 11
cases.
The Rollover Provision refers to fees FTI is entitled to that are
in excess of the previous monthly caps. The period during which
the Rollover Provision is applicable is currently scheduled to
expire on March 31, 2013.
The Debtors believe that extension of the expiry date of the
Rollover Provision is appropriate because, due to a change in
circumstances, FTI has been required to expend time greater than
was anticipated over periods different than projected at the
outset of the Debtors' Chapter 11 cases.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Expands Scope of Deloitte & Touche Work
------------------------------------------------------------
Residential Capital LLC and its affiliates ask the Court to
approve additional engagement letters with Deloitte & Touche LLP,
which expands the scope of the firm's employment to include
additional auditing and compliance related services, including
examination of Debtor GMAC Mortgage, LLC's internal controls
related to its mortgage servicing activities, and performance of
independent auditing for Debtor Residential Capital, LLC's
abbreviated financial statements for its Federal National Mortgage
Association Servicing and certain related loan origination
operations.
Walter Investment Management Corp. and Ocwen Loan Servicing, LLC,
have agreed to be responsible for certain of the additional
compensation and expenses.
Tom A. Robinson, a partner of Deloitte & Touche, maintains that
his firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtors and their estates.
A hearing on the request is set for March 25, 2013. Objections
were due March 22.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
ROC FINANCE: New $535MM Term Loan Gets Moody's 'B1' Rating
----------------------------------------------------------
Moody's Investors Service affirmed ROC Finance LLC's B3 Corporate
Family Rating, B3-PD Probability of Default Rating and debt
instrument ratings.
Moody's also assigned a B1 rating to ROC's proposed $535 million
6-year first lien term loan and $35 million 5-year first lien
revolver expiring 2018. The rating outlook is stable. Ratings of
the new facilities are subject to final documentation.
The proceeds of the proposed term loan will be used to refinance
the company's existing $425 million senior secured term loans due
2017, fund the acquisition of the Higbee building that currently
houses the company's Horseshoe Casino Cleveland and pay fees and
expenses. The ratings on the term loan due 2017 and revolver
expiring in 2016 will be withdrawn when the transaction closes.
Ratings Rationale:
The affirmation of ROC's B3 Corporate Family Rating ("CFR")
reflects substantially lower development risk now that ROC's
Cleveland and Cincinnati casinos are open and Thistledown is on
target to open on April 9, 2013 and the company's adequate
liquidity. The affirmation also reflects Moody's view that the
proposed purchase of the Higbee building (which currently houses
the Horseshoe Casino Cleveland) will help improve the performance
of Horseshoe Cleveland, the transaction will lower interest
expense (about $5 million), and extend maturity of the term loan
and revolver maturities by two years to 2019 and 2018,
respectively.
Once ROC purchases the Higbee building, it will begin construction
on a pedestrian bridge between the casino and the parking garage
that will facilitate more convenient access to the casino and help
boost both visitation and length of stay at the casino. ROC's
Cleveland casino has experienced a slower earnings ramp-up
relative to Moody's original expectations due primarily to lower
slot win per unit (WPU), partially offset by stronger table game
performance. Since the Horseshoe Casino Cleveland's opening in May
2012, it has reported average monthly WPU of approximately $259,
significantly below Moody's expectations. ROC has sufficient
available funds to complete construction, and Moody's estimates
EBITDA/interest coverage will be approximately 1.7 times over the
next twelve months. ROC's ratings are also supported by the
operating experience of the project manager, Caesars Entertainment
Corporation (Caa1 stable), and the market profile of both
Cleveland and Cincinnati will enable each casino to reach
projected levels of profitability.
The B1 rating on the first lien bank facilities reflects the
significant amount ($380 million) of second lien debt that
provides support to the first lien in the event of a default. The
Caa2 rating on the second lien notes reflects the contractual
subordination to the approximate $695 million first lien bank debt
and equipment financing.
The stable rating outlook reflects Moody's expectations that ROC
will have sufficient funds to complete construction and ramp-up of
the Thistledown project, and that ROC's three casinos combined
will earn a return on investment such that at year-end 2014
debt/EBITDA will range between 5.0 times to 5.5 times. The outlook
could be changed to negative if monthly gaming revenue in the
Cleveland and Cincinnati markets were to decline, thereby reducing
the company's liquidity cushion.
Ratings could be lowered if the Thistledown projects experience
cost over-runs or construction delays, if interest coverage is
less than anticipated, or if the company's liquidity were to
deteriorate for any reason.
Ratings improvement is limited at this time given the need to
complete the construction of Thistledown and ramp-up the
operations at ROC's Cleveland and Cincinnati casinos. However, if
it appears that all three properties can ramp up to a level that
ROC can achieve debt/EBITDA below 5 times and EBIT/interest above
1.5 times, the ratings could be considered for an upgrade.
Ratings affirmed and LGD assessments revised:
Corporate Family Rating at B3
Probability of Default Rating at B3-PD
$380 million 12.125% second lien notes due 2018 at Caa2 (LGD 5,
82% from 83%)
Ratings assigned:
Propose $535 million 6-year first lien senior secured term loan at
B1 (LGD 2, 29%)
Proposed $35 million 5-year first lien senior secured revolver at
B1 (LGD 2, 29%)
Ratings affirmed and to be withdrawn:
$35 million senior secured revolver expiring 2016 at B1 (LGD 2,
29% from 28%)
$300 million senior secured term loan due 2017 at B1 (LGD 2, 29%
from 28%)
$125 million senior secured delayed draw term loan due 2017 at B1
(LGD 2, 29% from 28%)
The principal methodology used in this rating was the Global
Gaming Industry Methodology published in December 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
ROC is indirectly owned by Rock Ohio Caesars LLC. Rock Ohio
Caesars LLC is a joint venture between Caesars Entertainment
Corporation and Rock Ohio Ventures LLC. The principal investor in
Rock Ohio Ventures LLC is Dan Gilbert, chairman and founder of
Quicken Loans and majority owner of the Cleveland Cavaliers NBA
franchise. Through various subsidiaries, ROC owns/operates
Horseshoe Casino Cleveland which opened in May 2012, Horseshoe
Casino Cincinnati which opened in March 2013, and is developing a
third project: Thistledown, a slot-only racino just outside of
Cleveland. Thistledown racetrack -- which is expected to open
April 9, 2013 -- is located about 15 miles southeast of Cleveland
and will feature 57,000 square feet of gaming space and
approximate 1,150 video lottery terminals.
ROTHSTEIN ROSENFELDT: Jeweler Settles to Avoid $10 Million Risk
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that selling $9.9 million in jewelry to a Ponzi scheme
operator cost the jeweler $650,000 in settlement of a lawsuit by
the trustee for law firm Rothstein Rosenfeldt Adler PA.
The report recounts that Scott Rothstein, the mastermind of the
fraud, purchased jewelry from Levinson & Co., a high-end jeweler
in Fort Lauderdale, Florida. The bankruptcy trustee for the law
firm founded by Rothstein filed a lawsuit contending all the money
used to purchase jewelry over four years was stolen from
investors.
According to Mr. Rochelle, the handwriting was on the wall for
Levinson when the bankruptcy judge refused in November to dismiss
the suit on the jeweler's theory that he gave equal value.
Mr. Rothstein himself testified that he participated with Levinson
in "off the books cash transactions involving loose diamonds and
stones," the bankruptcy judge said in his opinion.
The judge said the allegations, if proven true at a later trial,
could prevent the jeweler from raising a good faith defense and
might constitute notice to Levinson that Rothstein was engaged in
fraud.
Rather than risk a trial and a judgment for more than $10 million,
Levinson decided to settle. Approved this week, the settlement
requires Levinson to pay a total of $650,000 in installments of
about $93,000 every four months through September 2014. If
Levinson misses a payment, he'll be slapped with a judgment for
$1.3 million.
Although trustee Herbert Stettin has a liquidating Chapter 11 plan
on file calling for full payment to holders of more than $141
million in unsecured claims, a group of more than 50 victims of
the Ponzi scheme arranged a hearing on April 12 where they will
ask the judge for conversion of the Chapter 11 case to liquidation
in Chapter 7. They believe the plan is a giveaway to TD Bank NA,
which creditors say was one of the "primary participants" in the
fraud.
"The conversion motion is a baseless and shameless and unfortunate
effort to distract the court from confirmation of the trustee's
plan," Paul Singerman, Esq., a lawyer for the trustee from Berger
Singerman LLP in Miami said in an interview with Bloomberg.
At the April 12 hearing, the bankruptcy judge will consider
approving disclosure materials explaining the trustee's plan, Mr.
Singerman said. If the judge approves, creditors can begin voting
on the plan.
About Rothstein Rosenfeldt
Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler
PA -- http://www.rra-law.com/-- has been suspected of running a
$1.2 billion Ponzi scheme. U.S. authorities claimed in a civil
forfeiture lawsuit filed November 9, 2009, that Mr. Rothstein, the
firm's former chief executive officer, sold investments in non-
existent legal settlements. Mr. Rothstein pleaded guilty to five
counts of conspiracy and wire fraud on January 27, 2010.
Creditors of Rothstein Rosenfeldt Adler signed a petition sending
the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No.
09-34791). The petitioners include Bonnie Barnett, who says she
lost $500,000 in legal settlement investments; Aran Development,
Inc., which said it lost $345,000 in investments; and trade
creditor Universal Legal, identified as a recruitment firm, which
said it is owed $7,800. The creditors alleged being owed money
invested in lawsuit settlements.
Herbert M. Stettin, the state-court appointed receiver for
Rothstein Rosenfeldt, was officially carried over as the
Chapter 11 trustee in the involuntary bankruptcy case.
On June 10, 2010, Mr. Rothstein was sentenced to 50 years in
prison.
The official committee of unsecured creditors appointed in the
case filed a bankruptcy plan and disclosure statement on Aug. 17.
The plan was filed and signed by the Committee attorney, Michael
Goldberg of Akerman Senterfitt, and not by the court-appointed
trustee Herbert Stettin. The plan calls for the creation of a
liquidating trust and four classes of claimants. A date for
confirmation of the plan was left blank.
STOCKTON, CA: Judge Limits Experts at This Week's Trial
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when Stockton, California, goes on trial March 25 to
prove its eligibility for municipal bankruptcy in Chapter 9, the
bankruptcy judge in Sacramento won't be hearing testimony from two
experts hired by creditors. The judge said he doesn't need help
from experts because he's been interpreting financial information
for as long as he's been on the bench.
According to the report, the judge plans for the trial to be
finished by March 28. He's giving each side 700 minutes to offer
evidence, examine witnesses, conduct cross examination of
opponents' witnesses, and make arguments.
To remain in municipal bankruptcy, Stockton must persuade the
judge that it's insolvent, eligible for bankruptcy under state
law, and negotiated with creditors in good faith in advance of
bankruptcy. Some creditors and bondholders are opposing the right
to remain in bankruptcy.
About Stockton, Calif.
The City of Stockton, California, filed a Chapter 9 petition
(Bankr. E.D. Calif. Case No. 12-32118) in Sacramento on June 28,
2012, becoming the largest city to seek creditor protection in
U.S. history. The city was forced to file for bankruptcy after
talks with bondholders and labor unions failed. Stockton
estimated more than $1 billion in assets and in excess of
$500 million in liabilities.
The city, with a population of about 300,000, identified the
California Public Employees Retirement System as the largest
unsecured creditor with a claim of $147.5 million for unfunded
pension costs. In second place is Wells Fargo Bank NA as trustee
for $124.3 million in pension obligation bonds. The list of
largest creditors includes $119.2 million owing on four other
series of bonds.
The city is being represented by Marc A. Levinson, Esq., and John
W. Killeen, Esq., at Orrick, Herrington & Sutcliffe LLP. The
petition was signed by Robert Deis, city manager.
Mr. Levinson also represented the city of Vallejo, Calif. in its
2008 bankruptcy. Vallejo filed for protection under Chapter 9
(Bankr. E.D. Calif. Case No. 08-26813) on May 23, 2008, estimating
$500 million to $1 billion in assets and $100 million to $500
million in debts in its petition. In August 2011, Vallejo was
given green light to exit the municipal reorganization. The
Vallejo Chapter 9 plan restructures $50 million of publicly held
debt secured by leases on public buildings. Although the Plan
doesn't affect pensions, it adjusts the claims and benefits of
current and former city employees. Bankruptcy Judge Michael
McManus released Vallejo from bankruptcy on Nov. 1, 2011.
TRANS NATIONAL: Blue Casa Buys Telecom Reseller
-----------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Trans National Communications International Inc., a
Boston-based reseller of telecommunications services, received
court approval to sell the business and accounts receivable to
Blue Casa Telephone LLC for $14 million cash.
There were no competing bids, according to the report.
The report relates that with the business sold, creditors dropped
their request for appointment of a trustee or an examiner.
About Trans National Communications
Boston, Massachusetts-based phone and data communication services
provider Trans National Communications filed for Chapter 11
bankruptcy protection (Bankr. D. Mass. Case No. 11-19595) on
Oct. 9, 2011, estimating $1 million to $10 million in assets and
$10 million to $50 million in debts.
Judge William C. Hillman oversees the case. Harold B. Murphy,
Esq. and Christopher M. Condon, Esq., at Murphy & King, serve as
the Debtor's counsel. Verdolino & Lowey, P.C., serves as the
Debtor's financial advisors. Mintz Levin Cohn Ferris Glovsky and
Popeo PC serves as the Debtor's special telecommunications
counsel. The Staten Group and Bruce E. Rogoff, as chief
restructuring officer and advisor.
Anthony L. Gray, Esq., at Pollack & Flanders, LLP; and Kenneth M.
Misken, Esq., at Miles & Stockbridge, P.C., represent the Official
Committee of Unsecured Creditors.
UNIVISION COMMS: DirecTV Carriage Deal No Impact on 'B3' CFR
------------------------------------------------------------
Moody's Investors Service said Univision Communications, Inc.'s
announcement that it signed a comprehensive multi-year carriage
agreement with DirecTV (DTV; Baa2, stable rating outlook) is
credit positive for Univision by further expanding distribution
for Univision's new sports, telenovelas and news cable networks
and extending its long-term contractual relationship with the
U.S.'s second largest MVPD.
Univision's B3 Corporate Family Rating Rationale: and stable
rating outlook are not affected due to the company's continued
high leverage, but ongoing positive operating momentum and
maturity extensions are beneficial to the company's credit profile
and could lead to upward rating movement.
The principal methodology used in rating Univision was the Global
Broadcast and Advertising Related Industries Methodology published
in May 2012. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.
Univision, headquartered in New York, NY, is the leading Spanish-
language media company in the United States. Revenue for fiscal
year ended December 2012 was approximately $2.4 billion.
VANTIV LLC: S&P Lifts Corp Credit Rating to 'BB+'; Outlook Stable
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Symmes Township, Ohio-based Vantiv LLC to 'BB+' from
'BB'. The outlook is stable.
In addition, S&P raised the issue-level rating on the company's
first-lien senior secured credit facilities (consisting of a
$250 million revolver, a $1 billion term loan A, and a
$250 million term loan B) to 'BBB' from 'BBB-'. The recovery
rating on this debt is unchanged at '1', indicating S&P's
expectation of very high (90% to 100%) recovery for lenders in the
event of a payment default.
"The upgrade on the corporate credit rating reflects Vantiv's
successful first year as a public company, in which it had revenue
and transaction growth in the mid- to high-teens percent range,
sustained high EBITDA margins, and delevered to the mid-2x area,"
said Standard & Poor's credit analyst Alfred Bonfantini.
The ratings on Vantiv reflect the company's "intermediate"
business risk profile and "significant" financial risk profile.
The business risk incorporates Vantiv's meaningful market position
in the U.S. payment processing industry, breadth of services,
above-average industry EBITDA margins, and strong growth momentum.
These factors are partially offset by relatively limited
geographic diversity and highly competitive, rapidly evolving
industry conditions with both similar size and substantially
larger competitors. The financial risk profile acknowledges the
company's good FOCF and currently moderate leverage, but also its
acquisitive growth strategy, and short track record of operating
with the current leverage profile.
The outlook is stable, reflecting Vantiv's significant market
share in the U.S. debit processing market, strong operating
trends, and solid FOCF generation.
Ratings upside is limited over the near term because of the
company's short track record operating with the current leverage
profile, the use of all secured debt in its capital structure, and
lack of clarity on longer-term financial policies.
S&P could lower the rating if increased competition or a recession
lead to pricing pressure, high attrition, and lower processing
volumes, and resulted in leverage sustained in the low- to mid-3x
area. A more aggressive posture toward debt-financed
acquisitions, as the company pursues its diversification and
growth strategies, or shareholder returns could also precipitate a
downgrade.
VITRO SAB: Says Settlement Won't Be Completed Until April
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Vitro SAB reported to the Court of Appeals in New
Orleans that a settlement with U.S. bondholders probably won't be
carried out before early April. Although the bankruptcy court in
Dallas approved the settlement this month, it still requires
authorization in Mexico, Vitro said.
According to the report, Vitro was reporting to the appeals court
to forestall proceeding with appeals that can be dropped as a
result of the settlement where bondholders will receive 85.25% of
the face amount of their bonds plus $57.5 million to cover legal
fees. Vitro had $1.2 billion of bonds in default. The settlement
was made with holders of about 60%.
About Vitro SAB
Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global
glass producer, serving the construction and automotive glass
markets and glass containers needs of the food, beverage, wine,
liquor, cosmetics and pharmaceutical industries.
Vitro is the largest manufacturer of glass containers and flat
glass in Mexico, with consolidated net sales in 2009 of MXN23,991
million (US$1.837 billion).
Vitro defaulted on its debt in 2009, and sought to restructure
around US$1.5 billion in debt, including US$1.2 billion in notes.
Vitro launched an offer to buy back or swap US$1.2 billion in
debt from bondholders. The tender offer would be consummated
with a bankruptcy filing in Mexico and Chapter 15 filing in the
United States. Vitro said noteholders would recover as much as
73% by exchanging existing debt for cash, new debt or convertible
bonds.
Concurso Mercantil & Chapter 15 Proceedings
Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a
pre-packaged Concurso Plan in the Federal District Court for
Civil and Labor Matters for the State of Nuevo Leon, commencing
its voluntary concurso mercantil proceedings -- the Mexican
equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB
also commenced parallel proceedings under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan
on Dec. 13, 2010, to seek U.S. recognition and deference to its
bankruptcy proceedings in Mexico.
Early in January 2011, the Mexican Court dismissed the Concurso
Mercantil proceedings. But an appellate court in Mexico
reinstated the reorganization in April 2011. Following the
reinstatement, Vitro SAB on April 14, 2011, re-filed a petition
for recognition of its Mexican reorganization in U.S. Bankruptcy
Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754).
The Vitro parent received sufficient acceptances of its
reorganization by using the US$1.9 billion in debt owing to
subsidiaries to vote down opposition by bondholders. The holders
of US$1.2 billion in defaulted bonds opposed the Mexican
reorganization plan because shareholders could retain ownership
while bondholders aren't being paid in full.
Vitro announced in March 2012 that it has implemented the
reorganization plan approved by a judge in Monterrey, Mexico.
In the present Chapter 15 case, the Debtor seeks to block any
creditor suits in the U.S. pending the reorganization in Mexico.
Chapter 11 Proceedings
A group of noteholders opposed the exchange -- namely Knighthead
Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc.,
Davidson Kempner Distressed Opportunities Fund LP, and Brookville
Horizons Fund, L.P. Together, they held US$75 million, or
approximately 6% of the outstanding bond debt. The Noteholder
group commenced involuntary bankruptcy cases under Chapter 11 of
the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D.
Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010.
Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation
counsel to analyze the potential rights that Vitro may exercise
in the United States against the ad hoc group of dissident
bondholders and its advisors.
A larger group of noteholders, known as the Ad Hoc Group of Vitro
Noteholders -- comprised of holders, or investment advisors to
holders, which represent approximately US$650 million of the
Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not
among the Chapter 11 petitioners, although the group has
expressed concerns over the exchange offer. The group says the
exchange offer exposes Noteholders who consent to potential
adverse consequences that have not been disclosed by Vitro. The
group is represented by John Cunningham, Esq., and Richard
Kebrdle, Esq. at White & Case LLP.
A bankruptcy judge in Fort Worth, Texas, denied involuntary
Chapter 11 petitions filed against four U.S. subsidiaries. On
April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro
America LLC and three other U.S. subsidiaries -- that were
subject to the involuntary petitions into voluntary Chapter 11.
The Texas Court on April 21 denied involuntary petitions against
the eight U.S. subsidiaries that didn't consent to being in
Chapter 11.
Kurtzman Carson Consultants is the claims and notice agent to
Vitro America, et al. Alvarez & Marsal North America LLC, is the
Debtors' operations and financial advisor.
The official committee of unsecured creditors appointed in the
Chapter 11 cases of Vitro America, et al., has selected Sarah
Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq.,
and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP,
in New York, as counsel. Blackstone Advisory Partners L.P.
serves as financial advisor to the Committee.
The U.S. Vitro companies sold their assets to American Glass
Enterprises LLC, an affiliate of Sun Capital Partners Inc., for
US$55 million.
U.S. subsidiaries of Vitro SAB are having their cases converted
to liquidations in Chapter 7, court records in January 2012 show.
In December, the U.S. Trustee in Dallas filed a motion to convert
the subsidiaries' cases to liquidations in Chapter 7. The
Justice Department's bankruptcy watchdog said US$5.1 million in
bills were run up in bankruptcy and hadn't been paid.
On June 13, 2012, U.S. Bankruptcy Judge Harlin "Cooter" Hale in
Dallas entered a ruling that precluded Vitro from enforcing
its Mexican reorganization plan in the U.S. Vitro's appeal is
pending.
In November 2012, the U.S. Court of Appeals Judge Carolyn King
ruled that Vitro SAB won't be permitted to enforce its bankruptcy
reorganization plan in the U.S. She said that Vitro "has not
shown that there exist truly unusual circumstances necessitating
the release" preventing bondholders from suing subsidiaries.
In early March 2013, Vitro announce a settlement that will end all
litigation between Vitro and certain creditors in Mexico and the
United States over the past two years.
W.R. GRACE: Seeks Bankruptcy Court Approval to Pay Bonuses
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that W.R. Grace & Co. is seeking bankruptcy court approval
for incentive bonuses, as it has done every year since filing for
Chapter 11 reorganization in April 2001 to deal with asbestos
claims.
The proposal for this year would cost $18.9 million if targets are
met. For executives, the bonuses will all be paid in stock. For
others, the bonuses are half cash and half stock. This year's
bonuses are measured by performance from 2013 to 2015 and
will be paid in early 2016.
There will be an April 6 hearing in U.S. Bankruptcy Court in
Delaware for approval of the bonus program.
The Columbia, Maryland-based company's shares fell $1.01 March 21
to $77.50 in New York Stock Exchange Trading.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of the Plan.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
The plan can't be implemented because pre-bankruptcy secured bank
lenders filed an appeal currently pending in the U.S. Court of
Appeals in Philadelphia.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
WM SIX FORKS: Raleigh Apartment Project Sold in Debt Swap
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the 298-unit Manor Six Forks luxury apartment project
in Raleigh, North Carolina, is being purchased by secured lender
Lenox Mortgage XVII LLC in exchange for $37.1 million in mortgage
debt. There were no acceptable competing bids, so the auction was
canceled.
The project's owner already secured a confirmation order approving
a liquidating Chapter 11 plan calling for the sale. As the
consequence of an alleged technical flaw in the mortgage, Lenox
settled by contributing some $1.5 million to a fund for unsecured
creditors. The disclosure statement told unsecured creditors they
could expect to recover about 13% on their $5 million in claims.
Mechanics lienholders and subordinated secured creditors, whose
claims aggregate $6 million, could expect the same recovery.
About WM Six Forks
WM Six Forks LLC is the owner of an apartment and retail/office
complex in Raleigh, North Carolina, known as Manor Six Forks,
which opened in March 2010. The property includes 298 residential
apartments and roughly 14,000 square feet of retail/office space
on the ground floor. As of the bankruptcy filing date, all the
retail/office space is vacant and roughly 95% of the residential
apartments are subject to existing leases.
WM Six Forks filed a Chapter 11 petition (Bankr. E.D.N.C. Case No.
12-05854) on Aug. 12, 2012. The Debtor said in court papers the
Manor is valued at $32.54 million. The Debtor also owns a 15.15-
acre property, the value of which is not yet determined. The
Debtors' property serves as collateral to a $39 million debt to
Lenox Mortgage XVI, LLC. A copy of the schedules filed together
with the petition is available at http://bankrupt.com/misc/nceb12-
05854.pdf
Bankruptcy Judge J. Rich Leonard oversees the case. The Debtor
hired Northen Blue, LLP as counsel. The petition was signed by
William G. Garner, manager of WM6F Completion & Performance
Assoc., LLC. Dawn Barnes has been assigned as case manager.
The Bankruptcy Administrator for the Eastern District of North
Carolina Bankruptcy notified that it was unable to form a
creditors committee in the Chapter 11 case of WM Six Forks, LLC.
* Moody's Notes Decline in Number of Companies with Low Ratings
---------------------------------------------------------------
The number of low-rated US companies on its B3 Negative and Lower
Corporate Ratings List continued to decline in the opening months
of 2013, Moody's Investors Service says in a new report. The
decrease, to 146 from 152 in December and 176 this time last year,
is in line with the rating agency's expectation that the US
speculative-grade default rate will remain low this year, to end
it at 2.5%.
"Accommodating credit markets and slow, but steady economic growth
have reduced the number of companies in the lower ranks of credit
quality," says David Keisman, Senior Vice President and author of
"List Shows Good Conditions for Low-Rated US Companies." "And this
is despite European debt concerns, slower growth in China and
ongoing fiscal policy debates in the US."
At the same time, high-yield bond covenant quality has hit a new
low, Keisman says. "Robust high-yield issuance remains the engine
as investors lend to riskier companies in pursuit of higher
returns, and strong demand has allowed many companies to market
bonds with weak protections." Moody's three-month average Covenant
Quality Index recorded its weakest reading in February since it
began in January 2011.
Nevertheless, the covenant quality of bonds issued by the 37
companies that remain on Moody's B3 Negative and Lower List and
that form part of its Covenant Quality Index is much stronger,
consistent with the expectation that weaker credits will provide
more protective covenants.
While its B3 Negative and Lower List points to stable conditions
for speculative-grade companies, Moody's other indicators also
reflect good conditions for lower-rated credit, Keisman says.
Moody's Liquidity-Stress Index is near a record low and its
Covenant Stress Index suggests that few companies are at risk of
breaches. In addition, its recently launched Refunding Index shows
that upcoming debt maturities pose little risk for these firms.
* District Court Affirms Punitive Damages Imposed on Wells Fargo
----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that a federal district judge ruled on appeal that
Wells Fargo Bank NA's "reprehensible" conduct in overcharging
bankrupts on home mortgages warranted $3.17 million in punitive
damages meted out by a bankruptcy judge in Louisiana. In view of
the bank's "intentional and egregious" violation of the so-called
automatic stay in bankruptcy, the punitive damages were upheld
this week by U.S. District Judge Ivan L.R. Lemelle in New Orleans.
The report relates that on appeal, the San Francisco-based bank
didn't contest the finding that unauthorized charges on a home
mortgage violated an individual's Chapter 13 plan. The only
question on appeal was whether $3.17 million was so large that the
punitive damages violated the bank's due process rights.
The report says upholding the lower court, Judge Lemelle said the
bank admitted that overcharges imposed on bankrupts "were part of
its normal course of conduct, practiced in perhaps thousands of
cases." The bankruptcy court concluded that the bank's conduct
"was willful, egregious and exhibited a reckless disregard for the
stay it violated."
Judge Lemelle said the bankruptcy judge was correct in concluding
that Wells Fargo's behavior was "reprehensible."
The bankruptcy court had awarded $317,000 in actual damages to
reimburse the bankrupt for legal expenses in holding the bank in
violation of the automatic stay. Judge Lemelle said that punitive
damages 10 times "compensatory damages is within the
constitutional limits."
The report relates that Chief Bankruptcy Judge Elizabeth W. Magner
imposed punitive damages because sanctions in three prior cases
"have not deterred Wells Fargo." She said punitive damages were
"designed to deter future misconduct" and ended her 21-page
opinion by expressing hope that "the relief granted will finally
motivate Wells Fargo to rectify its practices."
Individuals and companies in bankruptcy are protected by the so-
called automatic stay which prohibits a wide variety of actions
against bankrupts or their properties. For violation of the
automatic stay, Section 362(k)(1) of the U.S. Bankruptcy Code
permits punitive damages in "appropriate circumstances."
The case on appeal is Jones v. Wells Fargo Home Mortgage Inc.,
12-cv-01362, U.S. District Court, Eastern District of Louisiana
(New Orleans). The case in bankruptcy court is Jones v. Wells
Fargo Home Mortgage Inc. (In re Jones), 06-bk-01093, U.S.
Bankruptcy Court, Eastern District of Louisiana (New Orleans).
* Statistics Points Toward Fewer Chapter 11s in 2013
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the future looks bleak for professionals making their
money from bankruptcy. The list of companies rated B3 or lower by
Moody's Investors Service with negative outlooks shrank to 146 in
March from 152 in December and 176 a year ago.
According to the report, Moody's said there are few companies at
risk of violating loan covenants. Similarly, "upcoming debt
maturities pose little refinancing risk," according to the Moody's
report. Moody's is now predicting that the default rate for junk-
rated companies will decline by the end of the year to 2.5% from
3.3% where it stood in February.
While defaults are fewer, the quality of loan covenants is
declining. Moody's covenant quality index stood at 3.96 in
February, on a scale where 5 represents the weakest covenants
and 1 the strongest. The index now reflects the weakest covenants
since Moody's started keeping score in January 2011.
* BOND PRICING -- For Week From March 18 to 22, 2013
----------------------------------------------------
Company Coupon Maturity Bid Price
------- ------ -------- ---------
AES EASTERN ENER 9.000 1/2/2017 1.750
AES EASTERN ENER 9.670 1/2/2029 4.125
AGY HOLDING COR 11.000 11/15/2014 50.000
AHERN RENTALS 9.250 8/15/2013 78.020
ALION SCIENCE 10.250 2/1/2015 54.678
ANHEUSER-BUSCH 2.500 3/26/2013 100.177
ATP OIL & GAS 11.875 5/1/2015 6.500
ATP OIL & GAS 11.875 5/1/2015 6.250
ATP OIL & GAS 11.875 5/1/2015 6.250
BUFFALO THUNDER 9.375 12/15/2014 31.000
CENGAGE LEARN 12.000 6/30/2019 29.250
CENGAGE LEARNING 13.750 7/15/2015 20.500
CHAMPION ENTERPR 2.750 11/1/2037 0.500
DELTA AIR 1993A1 9.875 4/30/2049 21.750
DEX ONE CORP 14.000 1/29/2017 42.000
DOWNEY FINANCIAL 6.500 7/1/2014 63.000
DYN-RSTN/DNKM PT 7.670 11/8/2016 4.500
EASTMAN KODAK CO 7.000 4/1/2017 14.250
EASTMAN KODAK CO 7.250 11/15/2013 13.500
EASTMAN KODAK CO 9.200 6/1/2021 12.540
EASTMAN KODAK CO 9.950 7/1/2018 12.665
EDISON MISSION 7.500 6/15/2013 51.974
EDMC-CALL04/13 8.750 6/1/2014 99.250
ELEC DATA SYSTEM 3.875 7/15/2023 97.000
FIBERTOWER CORP 9.000 11/15/2012 3.000
FIBERTOWER CORP 9.000 1/1/2016 12.000
FULL GOSPEL FAM 8.400 6/17/2031 10.067
GEOKINETICS HLDG 9.750 12/15/2014 51.125
GEOKINETICS HLDG 9.750 12/15/2014 51.375
GLB AVTN HLDG IN 14.000 8/15/2013 21.000
GMX RESOURCES 4.500 5/1/2015 35.000
GMX RESOURCES 9.000 3/2/2018 20.000
HAWKER BEECHCRAF 8.500 4/1/2015 9.000
HAWKER BEECHCRAF 8.875 4/1/2015 1.125
INTL LEASE FIN 6.375 3/25/2013 100.000
JAMES RIVER COAL 3.125 3/15/2018 21.450
JAMES RIVER COAL 4.500 12/1/2015 34.750
LAS VEGAS MONO 5.500 7/15/2019 20.000
LBI MEDIA INC 8.500 8/1/2017 28.250
LEHMAN BROS HLDG 0.250 12/12/2013 22.125
LEHMAN BROS HLDG 0.250 1/26/2014 22.125
LEHMAN BROS HLDG 1.000 10/17/2013 22.125
LEHMAN BROS HLDG 1.000 3/29/2014 22.125
LEHMAN BROS HLDG 1.000 8/17/2014 22.125
LEHMAN BROS HLDG 1.000 8/17/2014 22.125
LEHMAN BROS HLDG 1.250 2/6/2014 22.125
MASHANTUCKET PEQ 8.500 11/15/2015 7.500
MASHANTUCKET PEQ 8.500 11/15/2015 7.500
MASHANTUCKET TRB 5.912 9/1/2021 7.500
MF GLOBAL LTD 9.000 6/20/2038 76.000
OVERSEAS SHIPHLD 8.750 12/1/2013 73.000
PENSON WORLDWIDE 12.500 5/15/2017 41.500
PENSON WORLDWIDE 12.500 5/15/2017 24.375
PLATINUM ENERGY 14.250 3/1/2015 51.500
PLATINUM ENERGY 14.250 3/1/2015 51.500
PMI CAPITAL I 8.309 2/1/2027 0.625
PMI GROUP INC 6.000 9/15/2016 32.250
POWERWAVE TECH 1.875 11/15/2024 2.375
POWERWAVE TECH 1.875 11/15/2024 2.375
POWERWAVE TECH 3.875 10/1/2027 1.000
POWERWAVE TECH 3.875 10/1/2027 2.375
RESIDENTIAL CAP 6.875 6/30/2015 29.500
SAVIENT PHARMA 4.750 2/1/2018 27.000
SCHOOL SPECIALTY 3.750 11/30/2026 47.000
STATION CASINOS 6.625 3/15/2018 0.125
TERRESTAR NETWOR 6.500 6/15/2014 10.000
TEXAS COMP/TCEH 10.250 11/1/2015 10.750
TEXAS COMP/TCEH 10.250 11/1/2015 10.625
TEXAS COMP/TCEH 10.250 11/1/2015 10.125
TEXAS COMP/TCEH 10.500 11/1/2016 9.250
TEXAS COMP/TCEH 10.500 11/1/2016 15.875
TEXAS COMP/TCEH 15.000 4/1/2021 27.575
TEXAS COMP/TCEH 15.000 4/1/2021 25.250
THQ INC 5.000 8/15/2014 47.250
TL ACQUISITIONS 10.500 1/15/2015 19.875
TL ACQUISITIONS 10.500 1/15/2015 19.875
USEC INC 3.000 10/1/2014 34.938
VERSO PAPER 11.375 8/1/2016 53.984
WCI COMMUNITIES 4.000 8/5/2023 0.375
WCI COMMUNITIES 4.000 8/5/2023 0.375
WCI COMMUNITIES 6.625 3/15/2015 0.375
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors" Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., 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 2013. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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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
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The TCR subscription rate is $975 for 6 months delivered via
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*** End of Transmission ***