/raid1/www/Hosts/bankrupt/TCR_Public/130403.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, April 3, 2013, Vol. 17, No. 91
Headlines
22ND CENTURY: John Brodfuehrer Named Chief Financial Officer
2321 KENMORE: Voluntary Chapter 11 Case Summary
241 W 132: Case Summary & 5 Unsecured Creditors
308 PECK: Case Summary & 2 Unsecured Creditors
52 INC: Voluntary Chapter 11 Case Summary
921 EDGEWOOD: Voluntary Chapter 11 Case Summary
ADVANCED READY: Involuntary Chapter 11 Case Summary
AIRTOUCH COMMUNICATIONS: President and CEO Resigns
AMPAL-AMERICAN: Common Stock Delisted From NASDAQ
ANDERSON HOMES: Wins $122K Judgment Against HVAC Services Provider
APRIA HEALTHCARE: Moody's Lowers Term Loan Rating to 'B2'
ARCAPITA BANK: Panel Agrees to Dismiss Expedited Discovery Motion
ARCAPITA BANK: Disclosure Statement Hearing Adjourned to April 19
ASARCO LLC: Union Pacific Off The Hook For Superfund Cleanup Fees
ASCEND LEARNING: S&P Lowers CCR to 'CCC' on High Leverage
AVIV REIT: S&P Raises Corporate Credit Rating to 'BB-'
BERNARD L. MADOFF: Trustee Makes 3rd Distribution of $506.2MM
BEST PLUMBING: Case Summary & 20 Largest Unsecured Creditors
BIRDSALL SERVICES: NJ Engineering Firm Indicted, Files Chapter 11
BIRDSALL SERVICES: Case Summary & 20 Largest Unsecured Creditors
BONANZA CREEK: Moody's Gives B2 CFR & Rates New $250MM Notes 'B3'
BONTEN MEDIA: S&P Affirms CCC Corp Credit Rating; Outlook Negative
BRIGHTER DAYS: Case Summary & 13 Largest Unsecured Creditors
BYTEC INC: Case Summary & 20 Largest Unsecured Creditors
C.R.S. SERVICE: Case Summary & 20 Largest Unsecured Creditors
CASPIAN SERVICES: Amends Bylaws to Reflect Company Changes
CELL THERAPEUTICS: Inks Severance Pact with Matthew Plunkett
CENTRAL EUROPEAN: Copy of Rejected Mark Kaufman Proposal
CHARTER COMMUNICATIONS: Fitch Assigns 'BB+' Senior Secured Rating
COMPREHENSIVE CLINICAL: Case Summary & Creditors List
CONSOLIDATED CAPITAL: Incurs $449,000 Net Loss in 2012
COTO INVESTMENTS: Case Summary & 4 Unsecured Creditors
CROWNROCK L.P.: Moody's Lifts CFR to 'B3'; Outlook Stable
CUMULUS MEDIA: Slow Repayment Rate Cues Moody's to Lower Ratings
DBSI INC: Court Imposes Sanctions in Wavetronix Lawsuit
DCB FINANCIAL: Appoints Two New Directors to Board
DELTA-ADDISON LLC: Case Summary & 3 Unsecured Creditors
DIMENSIONS HEALTH: Fitch Affirms 'CC' Rating $56.6MM Revenue Bonds
DREIER LLP: Investor Coughs Up $3.5 Million
DUMA ENERGY: Incurs $481,700 Net Loss in Jan. 31 Quarter
ENERGYSOLUTIONS INC: Hearing on Derivative Suit Deal on April 15
ENTRAVISION COMMUNICATIONS: S&P Raises Corp. Credit Rating to 'B+'
EUROFRESH INC: Creditors' Panel Negotiates Sale Price Up
FLOORING AMERICA: Ga. App. Ct. Rules in Suntrust-Related Disputes
FNB UNITED: To Issue 600,000 Shares Under 2012 Incentive Plan
FREDERICK'S OF HOLLYWOOD: Harbinger Holds 77% Stake at March 15
G+G RETAIL: BCBG's Summary Judgment Bid Denied in Employee Suit
GEOKINETICS INC: Annual Report Filed
GMX RESOURCES: Files for Chapter 11 to Sell Biz to Lenders
GREGORY & PARKER: Has Green Light to Employ Janvier Law Firm
GRUBB & ELLIS: Consummates Confirmed Liquidating Plan
GSC GROUP: Kaye Scholer Says GSC Can't Seek Sanctions After Deal
H.A. DENTON: Case Summary & 3 Largest Unsecured Creditors
HAWKER BEECHCRAFT: Nyanjom Employee Suit Dismissed
HEMCON MEDICAL: Disclosures Approved, Plan Hearing on April 29
HOME CASUAL: Case Summary & 16 Unsecured Creditors
HOSTESS HOLDCO: S&P Assigns 'B-' CCR; Outlook Stable
HP GOLF: Voluntary Chapter 11 Case Summary
IDEARC INC: Creditors Try Old Verizon Theory in New Court
IDERA PHARMACEUTICALS: EY LLP Raises Going Concern Doubt
INNOVATIVE COMMUNICATION: D.V.I. Court Won't Hear Suit v. Trustee
INSPIREMD INC: Amends $30 Million Worth of Securities Offering
INTCOMEX INC: S&P Revises Outlook to Neg. & Affirms 'B' CCR
INTELLIPHARMACEUTICS INT'L: Closes $3.1-Mil. Offering of Units
ISTAR FINANCIAL: CEO Plans to Sell 962,963 Common Shares
IT FACTORY: Chapter 15 Case Summary
JENSEN MOVERS: Voluntary Chapter 11 Case Summary
JSC ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors
JUDSON COLLEGE: S&P Lowers Long-Term Bond Rating to 'BB+'
KV PHARMACEUTICAL: Securities Suit May Proceed Against Hermelin
KNL PROPERTIES: Voluntary Chapter 11 Case Summary
LA CAMBRE: Case Summary & 10 Unsecured Creditors
LA JOLLA: Richard Reinisch Holds 8.3% Equity Stake at March 21
LEXARIA CORP: Incurs $112K Net Loss in Fiscal 2013 1st Quarter
LIBERTY MEDICAL: Schedules Filing Deadline Extended to April 16
LHC LLC: May 5 Set as Claims Bar Date
LIBERTY MEDICAL: Court Approves Epiq as Administrative Advisor
LIFECARE HOLDINGS: Debtor, Creditors Rebut IRS on Hospitals' Sale
LIGHT GLOBAL: Case Summary & 20 Largest Unsecured Creditors
LLS AMERICA: Defendants Fined for Failure to Respond to Discovery
LODGENET INTERACTIVE: Plan Effective
LODGNET INTERACTIVE: Sullivan & Cromwell Aids Colony's $70M Recap
M & M INVESTORS: Case Summary & 20 Largest Unsecured Creditors
MARY HAD A LITTLE RAM: Case Summary & 12 Unsecured Creditors
MASHANTUCKET (WESTERN): S&P Gives Prelim CCC+ Issuer Credit Rating
MCC HUMBLE: U.S. Trustee Wins Chapter 11 Case Dismissal
MCCLATCHY CO: Nominates Former Wells Fargo Executive to Board
MEDICAL INVESTORS: Case Summary & 6 Unsecured Creditors
MEGANET CORP: Incurs $267K Net Loss in Sept. 30 Quarter
MIDWEST GAMING: S&P Withdraws 'B+' Corporate Credit Rating
MILAGRO OIL: Expects to Default on 2011 Credit Facility
MOTORS LIQUIDATION: Has Until Sept. 21 to Object to Claims
MPG OFFICE: Samuelson Replaces Lazar as Accounting Head
MTR GAMING: S&P Revises Outlook to Stable & Affirms 'B-' CCR
MTS LAND: US Bank Says 3rd Amended Plan Lacks Information
NAVISTAR INTERNATIONAL: Updates 10-K; Faces Shareholder Suits
NELSON EDUCATION: Refinance Risk Cues Moody's to Cut CFR to Caa2
NEW ENERGY: District Court Won't Hear Natural Chem Dispute
NNN LENOX: "Roll-Up" Plan Meets Objection from Secured Creditor
NORD RESOURCES: Termination of Copper Sales Pact Moved to June 30
NORTHERN STATES FINANCIAL: Incurs $12.6-Mil. Loss in 2012
NYC 36TH: Voluntary Chapter 11 Case Summary
OMNICOMM SYSTEMS: Cornelis Wit Holds 50.2% Stake at March 21
PARK PLUMBING: Case Summary & 20 Largest Unsecured Creditors
PAT'S TRANSPORTATION: Case Summary & 17 Unsecured Creditors
PATRIOT COAL: Control Fight Set for April 23 Court Hearing
PERFORMANT FINANCIAL: S&P Raises CCR to 'BB-'; Outlook Stable
PHOENIX-GREENVILLE'S INN: Case Summary & Creditors List
POLYMEDIX INC: Brilacidin Maker Files for Chapter 7 Liquidation
POSITIVEID CORP: Market Opportunities for M-BAND and Dragonfly
POSITIVEID CORP: Inks Intercreditor Agreement with Boeing and TCA
POWERWAVE TECHNOLOGIES: Common Stock Delisted From NASDAQ
PURIFIED RENEWABLE: Case Summary & 20 Largest Unsecured Creditors
PVR PARTNERS: S&P Lowers CCR to 'B+' and Affirms Negative Outlook
R.E. LOANS: Dallas District Court Rules on Investors' Claims
READER'S DIGEST: Sale Approval Sought
READER'S DIGEST: Can Hire Ordinary Course Professionals
READER'S DIGEST: Form of Adequate Assurance for Utilities Okayed
RG STEEL: Wells Fargo Says Creditors' Suit Doesn't Hold Up
RHYTHM AND HUES: Committee Taps Stutman Treister as Counsel
ROSETTA GENOMICS: Incurs $10.4 Million Net Loss in 2012
ROTHSTEIN ROSENFELDT: Trustee Wants Creditors' Counsel Fee Deals
RUN-SER DEVELEPMENT: Case Summary & 6 Unsecured Creditors
SAHGA GROUP: Case Summary & 4 Largest Unsecured Creditors
SALLY BEAUTY: S&P Revises Outlook to Stable & Affirms 'BB+' CCR
SAMSON MANUFACTURING: Case Summary & Creditors List
SAN DIEGO HOSPICE: Sued for Mass Firings Without Notice
SEAN DUNNE: Irish Developer Files for Chapter 7 in Connecticut
SEMINOLE TRIBE: Fitch Affirms 'BB+' Issuer Default Rating
SHEA HOMES: S&P Affirms 'B' Rating on $750MM Sr. Secured Notes
SIEGMUND STRAUSS: Case Summary & 20 Largest Unsecured Creditors
SIMON WORLDWIDE: Inks LLC Operating Agreement of Three Lions
SLATER STEELS: Court Rules in Suit Over Site Cleanup
SMI PARTNERS: Case Summary & Largest Unsecured Creditor
SOUTHERN MATTRESS: Case Summary & 20 Largest Unsecured Creditors
SOUTHERN MONTANA: Plan Disclosures Hearing Continued to April 23
SOUTHERN ONE: Hires DFW Lee & Associates as Broker
SP FABRICATORS: Case Summary & 20 Largest Unsecured Creditors
STANFORD GROUP: Investors Go to Bat For $300M SEC, Antiguan Deal
STELLAR BIOTECHNOLOGIES: Incurs $766K Net Loss in FY 2013 Q1
STEPHEN PUTNAL: Limits on Use of SunTrust Cash Collateral Affirmed
STEWARD HEALTH: S&P Assigns 'B' CCR & Rates $250MM Loan 'B'
STEWART INFORMATION: Fitch Affirms 'BB+' Sr. Unsecured Debt Rating
SUPERVALU INC: S&P Raises Corp. Credit Rating to 'B+'
SYNERGY BRANDS: Auditor Should Have Caught $1B Fraud, Suit Says
TCI COURTYARD: Has Plan to Pay Wells Fargo Over Time
TENNECO INC: S&P Revises Outlook to Positive & Affirms 'BB' CCR
TITAN PHARMACEUTICALS: FDA Recommends Approval of Probuphine
TOTAL MECHANICAL: Case Summary & 20 Largest Unsecured Creditors
TRIBUNE CO: Slams Bond Trustees' $13M Reimbursement Bid
TWL CORPORATION: Fifth Circuit Revives Employees' Class Suit
U.S. CAVALRY: Updated Case Summary & Creditors' Lists
UNIVERSAL HEALTH: Faces WARN Act Suit From Ex-Workers
US AIRWAYS: Fitch Upgrades Issuer Default Ratings to 'B+'
USA BABY: 7th Cir. Nixes Ex-Officer's Appeal, Threatens Sanctions
VHGI HOLDINGS: Amends Report on Shares Issuance to CEO
VITRO SAB: Takes Nondebtor Release Ban to Supreme Court
VPR OPERATING: Case Summary & 20 Largest Unsecured Creditors
WIZARD WORLD: Two Directors Appointed to Board
WISPER LLC: Case Summary & 20 Largest Unsecured Creditors
WOUND MANAGEMENT: Issues $500,000 Promissory Notes
XTREME IRON: Trustee Hires Litzler Segner as Accountants
* Fitch Says Modified Mortgages Still Pose Credit Risks for Banks
* Circuit Upholds Ruling Knocking Out Education Loan
* Libor Suits by Bondholders Tossed Over Lack of Damages
* S&P Case Should Stay in Connecticut Court, U.S. Says
* Merrill Sued for $309 Million by Trust over Mortgages
* Pay for Boards at Banks Soars Amid Cutbacks
* Upcoming Meetings, Conferences and Seminars
*********
22ND CENTURY: John Brodfuehrer Named Chief Financial Officer
------------------------------------------------------------
The Board of Directors of 22nd Century Group, Inc., appointed
John T. Brodfuehrer as Chief Financial Officer and Treasurer of
the Company, effective April 1, 2013. In connection with Mr.
Brodfuehrer's appointment, Mr. Henry Sicignano III will step down
from his role as interim Chief Financial Officer; Mr. Sicignano
will continue to serve as President, Secretary and Director of the
Company.
Mr. Brodfuehrer, age 55, has served for the past two years as
Chief Financial Officer of Latina Boulevard Foods, LLC, an entity
formed as the result of a merger of two long-time Western New York
wholesale food distributors. Prior to his employment with LBF,
Mr. Brodfuehrer was Vice-President of Retail Accounting for United
Refining Company, an independent refiner and marketer of petroleum
products. Prior to his time at URC, Mr. Brodfuehrer served in
multiple roles over a 24-year span with NOCO Incorporated
(formerly NOCO Energy Corp.), a diversified distributor of energy
products and related services. Mr. Brodfuehrer served as NOCO's
Chief Financial Officer, Vice-President and as a member of the
Board of Directors from 2000 to 2009. Mr. Brodfuehrer earned a
Bachelor of Science in Business Administration, summa cum laude,
from the State University of New York at Buffalo in 1979 and
became a New York State Certified Public Accountant in 1981.
Mr. Brodfuehrer executed an employment agreement by and between
himself and the Company dated March 19, 2013, for an initial term
of two years. Pursuant to the Employment Agreement, Mr.
Brodfuehrer will earn an initial base salary of $110,000 and may
become eligible for certain bonuses and equity awards.
Furthermore, if Mr. Brodfuehrer's employment is terminated prior
to the end of the initial two year term by the Company without
"Cause" or by Mr. Brodfuehrer for Good Reason, Mr. Brodfuehrer
will be entitled to a severance benefit in the form of a
continuation of his then-base salary until the later of (i) six
months from the termination date or (ii) the expiration of the
initial two year term.
In connection with his appointment, Mr. Brodfuehrer was also
awarded 100,000 restricted shares of the Company's common stock.
All of the Shares are subject to forfeiture until the first to
occur of the following: (i) the one-year anniversary of March 19,
2013, (ii) a Change in Control of the Company (as defined in the
Employment Agreement), (iii) the termination of Mr. Brodfuehrer's
employment with the Company by Death or Disability, or (iv) the
termination of Mr. Brodfuehrer's employment with the Company
without "Cause". The Shares are also subject to restrictions on
transfer as set forth in that certain Lock-Up Agreement dated
Jan. 11, 2013, by and between the Company and certain executives
of the Company.
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.
The Company incurred a net loss of $6.73 million in 2012, as
compared with a net loss of $1.34 million in 2011. 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.
2321 KENMORE: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: 2321 Kenmore Avenue, LLC
2321 Kenmore Avenue
Buffalo, NY 14207
Bankruptcy Case No.: 13-10799
Chapter 11 Petition Date: March 27, 2013
Court: U.S. Bankruptcy Court
Western District of New York (Buffalo)
Judge: Carl L. Bucki
Debtor's Counsel: Arthur G. Baumeister, Jr., Esq.
AMIGONE, SANCHEZ, MATTREY & MARSHALL, LLP
1300 Main Place Tower
350 Main Street
Buffalo, NY 14202
Tel: (716) 852-1300
E-mail: abaumeister@amigonesanchez.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company's list of its largest unsecured creditors filed with
the petition does not contain any entry.
The petition was signed by Robert Bingel, managing member.
241 W 132: Case Summary & 5 Unsecured Creditors
-----------------------------------------------
Debtor: 241 W 132 LLC
c/o Migdol Organization
223 W 138th Street
New York, NY 10030
Bankruptcy Case No.: 13-10875
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Robert E. Gerber
Debtor's Counsel: Isaac Nutovic, Esq.
NUTOVIC & ASSOCIATES
261 Madison Avenue, 26th Floor
New York, NY 10016
Tel: (212) 421-9100
E-mail: INutovic@Nutovic.com
Scheduled Assets: $1,250,000
Scheduled Liabilities: $773,000
A copy of the Company's list of its five largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/nysb13-10875.pdf
The petition was signed by Jerry Migdol, managing member.
308 PECK: Case Summary & 2 Unsecured Creditors
----------------------------------------------
Debtor: 308 Peck Lane LLC
174 North Cove Road
Old Saybrook, CT 06475
Bankruptcy Case No.: 13-30516
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
District of Connecticut (New Haven)
Debtor's Counsel: James Berman, Esq.
ZEISLER AND ZEISLER, P.C.
558 Clinton Avenue
P.O. Box 3186
Bridgeport, CT 06605
Tel: (203) 368-4234
E-mail: jberman@zeislaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its two largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/ctb13-30516.pdf
The petition was signed by Richard Mazzella, managing member.
52 INC: Voluntary Chapter 11 Case Summary
-----------------------------------------
Debtor: 52 Inc.
dba Aero 1031 Exchange Of California
Aero Management
3435 Wilshire Boulevard, Suite 2755
Los Angeles, CA 90010
Bankruptcy Case No.: 13-17647
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Central District of California (Los Angeles)
Judge: Barry Russell
Debtor's Counsel: Julian K. Bach, Esq.
LAW OFFICE OF JULIAN BACH
17011 Beach Boulevard, Suite 300
Huntington Beach, CA 92647
Tel: (714) 848-5085
Fax: (714) 848-5086
E-mail: Julian@Jbachlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Shahram Mokhtarzadeh, president.
921 EDGEWOOD: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: 921 Edgewood Street, LLC
aka 9233 Swallow Drive, LLC
921 Edgewood Drive, LLC
14101 Valleyheart Drive, Suite 201
Sherman Oaks, CA 91423
Bankruptcy Case No.: 13-12094
Chapter 11 Petition Date: March 27, 2013
Court: U.S. Bankruptcy Court
Central District of California (San Fernando Valley)
Judge: Alan M. Ahart
Debtor's Counsel: Erikson M. Davis, Esq.
LAW OFFICES OF ERIKSON M. DAVIS
20501 Ventura Boulevard, Suite 270
Woodland Hills, CA 91364
Tel: (818) 206-4253
Fax: (800) 756-6561
E-mail: erikdavis@att.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $100,001 to $500,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Derek Wiseman, president of Sunset West
Management, Inc., manager.
ADVANCED READY: Involuntary Chapter 11 Case Summary
---------------------------------------------------
Alleged Debtor: Advanced Ready Mix Corp.
215-40 28th Avenue
Bayside, NY 11360
Case Number: 13-41795
Involuntary Chapter 11 Petition Date: March 28, 2013
Court: Eastern District of New York (Brooklyn)
Petitioners' Counsel: David R. Hock, Esq.
COHEN WEISS AND SIMON LLP
330 West 42nd Street
New York, NY 10036
Tel: (212) 563-4100
Fax: (212) 695-5436
E-mail: dhock@cwsny.com
Advanced Ready Mix Corp.'s petitioners:
Petitioner Nature of Claim Claim Amount
---------- --------------- ------------
Local 282 Welfare Judgment for unpaid $20,752
Trust Fund contributions
2500 Marcus Avenue
Lake Success, NY 11042
Local 282 Pension Judgement for unpaid $20,851
Trust Fund contributions
2500 Marcus Avenue
Lake Success, NY 11042
Local 282 Annuity Judgment for unpaid $14,630
Trust Fund contributions
2500 Marcus Avenue
Lake Success, NY 11042
Local 282 Job Training Judgment for unpaid $289
Trust Fund contributions
2500 Marcus Avenue
Lake Success, NY 11042
AIRTOUCH COMMUNICATIONS: President and CEO Resigns
--------------------------------------------------
Hideyuki Kanakubo resigned as president and chief executive
officer and as a member of the board of directors of AirTouch
Communications, Inc., and its wholly-owned subsidiary, AirTouch,
Inc., on March 18, 2013. The board of directors of the Company
has initiated a search for a new president and chief executive
officer of the Company.
About AirTouch Communications
AirTouch Communications, Inc., formerly Waxess Holdings, Inc., is
a technology firm, located in Newport Beach, Cal., that was
incorporated in 2008 and designs innovative and state-of-the-art
wireless routers, stationary signal-enhanced cell phones, and
?Triple Play' (Voice/Data/Video over IP) portals. The Company
offers its HomeConneX (R) products through the dealer network of a
major wireless carrier and its SmartLinX TM products through
various distributors in the US and Mexico.
As reported in the TCR on March 26, 2012, Anton & Chia, LLP, in
Irvine, California, expressed substantial doubt about Waxess
Holdings' 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 sustained
accumulated losses from operations totaling $16 million at
Dec. 31, 2011.
The Company's balance sheet at June 30, 2012, showed $4.7 million
in total assets, $1.9 million in total liabilities and
stockholders' equity of $2.8 million.
AMPAL-AMERICAN: Common Stock Delisted From NASDAQ
-------------------------------------------------
The NASDAQ Stock Market LLC filed a Form 25 with the U.S.
Securities and Exchange Commission regarding the removal from
listing or registration of Ampal-American Israel Corp.'s common
stock on NASDAQ.
About Ampal-American
Ampal-American Israel Corporation -- http://www.ampal.com/--
acquired interests primarily in businesses located in Israel or
that are Israel-related. Ampal-American filed a Chapter 11
petition (Bankr. S.D.N.Y. Case No. 12-13689) on Aug. 29, 2012, to
restructure the Company's Series A, Series B and Series C
debentures. Bankruptcy Judge Stuart M. Bernstein presides over
the case. Ampal-American sought bankruptcy protection in the U.S.
because bankruptcy laws in Israel would lead to the Company's
liquidation.
Michelle McMahon, Esq., at Bryan Cave LLP, serves as the Debtor's
counsel. Houlihan Lokey serves as investment banker.
The petition was signed by Irit Eluz, chief financial officer,
senior vice president. The Company scheduled $290,664,095 in
total assets and $349,413,858 in total liabilities.
A three-member official committee of unsecured creditors is
represented by Brown Rudnick as counsel.
ANDERSON HOMES: Wins $122K Judgment Against HVAC Services Provider
------------------------------------------------------------------
In the clawback lawsuit, RICHARD D. SPARKMAN, Chapter 7 Trustee
for Anderson Homes, Inc. and Vanguard Homes, Inc., Plaintiff, v.
AMERICAN RESIDENTIAL SERVICES, LLC, Defendant, Adv. Proc. No.
11-00213 (Bankr. E.D.N.C.), Bankruptcy Judge Stephani W.
Humrickhouse ruled that the chapter 7 trustee is entitled to a
judgment against ARS in the amount of $122,861.66, plus interest
at the federal rate of 0.17% per annum from June 28, 2011 until
paid. The Court also denied ARS's request for sanctions based on
spoliation of evidence, saying ARS has not satisfied its burden of
showing that an adverse inference for spoliation of evidence is
warranted and that the parties intended the payments received from
the Debtors to be a contemporaneous exchange for new value.
ARS provided HVAC services to Anderson Homes. The Chapter 7
trustee sued ARS to avoid certain transfers between the debtors
and ARS totaling $186,419.35 which occurred during the 90-day
preference period preceding March 16, 2009.
A copy of the Court's March 28, 2013 Order is available at
http://is.gd/6s3Pa3from Leagle.com.
About Anderson Homes
Headquartered in Raleigh, North Carolina, Anderson Homes, Inc.,
engaged in the development, construction and sale of residential
properties in the form of single-family homes, townhomes and
condominiums. It owns, constructs improvements on, and sells (i)
single-family houses and townhomes in subdivisions known and
referred to as Edgewater, Bridgewater, Bridgewater West,
Cobblestone, Haw Village, Ridgefield, Amberlynn Valley, Cane
Creek, Muirfield Village, Pine Valley, Quail Meadows, Thornton
Commons Place, Willow Ridge, Creekside at Landon Farms, Keystone
Crossing, Sterling Ridge, Jeffries Creek, Briar Chapel, and Villas
at Forest Hills, and (ii) condominiums known as Blount Street
Commons.
Anderson Homes and its units -- Bridgewater Land Resource, LLC,
Land Resource Group of Raleigh, Inc., and Vanguard Homes, Inc. --
filed for Chapter 11 on March 16, 2009 (Bankr. E.D. N.C. Lead Case
No. 09-02062). Gerald A. Jeutter, Jr., Esq., and John A. Northen,
Esq., at Northen Blue, LLP, represented the Debtors in their
restructuring effort. At the time of the filing, Anderson Homes
said it had total assets of $17,190,001 and total debts of
$13,742,840.
On June 30, 2010, the cases were converted to chapter 7, and
Richard D. Sparkman was appointed as chapter 7 trustee in each
case.
APRIA HEALTHCARE: Moody's Lowers Term Loan Rating to 'B2'
---------------------------------------------------------
Moody's Investors Service lowered Apria Healthcare Group, Inc.'s
proposed senior secured term loan rating to B2 from B1 after the
company upsized the issuing amount to $900 million from $750
million. Moody's previously noted that the rating on the proposed
term loan could be adjusted to B2 if the final amount were
increased even modestly from $750 million. After the upsize, the
term loan will represent the preponderance of Apria's new debt
structure post refinancing, thus it is rated at par with the
corporate family rating of B2. Concurrently, Moody's affirmed all
existing ratings of the company including the B2 Corporate Family
Rating, the B2-PD Probability of Default Rating and the existing
B1 rating on the $700 million Senior Secured A-1 notes and Caa1
rating on the $318 million Senior Secured A-2 notes. The outlook
remains negative.
The proceeds from the $900 million senior secured term loan will
be used to refinance the company's $700 million Senior Secured
Series A-1 Notes due 2014 (the "A-1 Notes") and a portion of the
$318 million Senior Secured Series A-1 Notes due 2014, including
costs associated with the early redemption of such notes, and
provide cash to the balance sheet. The rating assigned on the
proposed term loan is subject to Moody's review of final terms and
conditions in the closing documents. Following repayment of the A-
1 Notes, the rating will be withdrawn. The rating on the Series A-
2 Notes will remain outstanding after the close of the
transaction.
Rating lowered:
$900 million senior secured term loan due 2020 to B2 (LGD3,
48%) from B1 (LGD3, 34%)
Ratings affirmed:
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
$700 million Series A-1 notes due 2014 at B1 (LGD3, 32%)
$318 million Series A-2 notes due 2014 at Caa1 (LGD5, 81%)
Ratings Rationale:
Apria's B2 Corporate Family Rating reflects the company's high
leverage and weak cash flow, ongoing exposure to reimbursement
risk, lower EBITDA margin relative to industry peers, and a
shareholder-oriented focus. Despite the long-term favorable
industry fundamentals such the ageing population in the US, the
homecare industry remains very fragmented and competitive in part
due to the low barriers to entry. Moody's believes going forward
there are a number of pressures facing the industry, including
competitive bidding and health care reform. Moody's expects
Apria's free cash flow to remain weak in the next 12-18 months
given the earnings pressure and the persistently higher levels of
capital expenditures required in its home respiratory
therapy/home-medical equipment unit. Therefore, Moody's expects
leverage to remain in the 5 times range.
Supporting the B2 rating is Apria's scale as the leading provider
of home healthcare products and services in the US with
significant market share in home respiratory and home infusion
therapy. Further, Apria benefits from good diversity by geography
and relatively more favorable payor profile as Medicare and
Medicaid constitute only roughly one-quarter of revenues, lower
than the other rated issuers in the homecare sector. Moody's also
views favorably the more stable home infusion business which helps
offset the more volatile earnings in the RT/HME business, however,
segment EBITDA is not expected to grow meaningfully in the near
term.
The negative rating outlook reflects Moody's concerns regarding
Apria's vulnerability to ongoing pricing pressure from Medicare
and Medicaid, such as Medicare competitive bidding and/or
government sequestrations as well as from its managed care
customers. The negative outlook incorporates Moody's expectation
that Apria will continue to have difficulty generating positive
free cash flow in 2013 (despite the expected interest savings from
the refinancing) in light of the ongoing earnings pressure and
high capital spending needs.
The SGL-3 reflects adequate liquidity which is constrained by the
approaching debt maturity of the Senior Secured Notes due 2014 and
Moody's expectation of weak free cash flow over the next 12 to 18
months. Though the company is refinancing the A-1 Notes and a
portion of the A-2 Notes, they will continue to have a significant
maturity, about $180 million, of the A-2 Notes outstanding and due
on November 1, 2014. Notably, there are springing maturities on
the ABL facility and newly-proposed term loan should Apria fail to
refinance the A-2 notes by 2014. Additionally there is expected to
be a maximum net first lien leverage covenant ratio requirement on
the proposed term loan.
Moody's could downgrade the rating should the company fail to
return to positive free cash flow, or if adjusted leverage were
expected to be sustained above 5.5 times. Additionally,
shareholder dividends or debt-financed acquisitions absent any
material EBITDA expansion could also result in a downgrade. A
delay in addressing the upcoming remaining maturity of the A-2
Notes in the near term will also pressure the ratings downward.
Although not likely over the near term, should the company's
EBITDA expand materially such that adjusted leverage were expected
to be sustained below 4.0 times and free cash flow to debt were
expected to be sustained above 8% the ratings could be upgraded.
The principal methodology used in this rating was the Global
Healthcare Service Providers published in December 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Apria Healthcare Group Inc., headquartered in Lake Forest, CA,
provides respiratory therapy and home medical equipment (50% of
revenues) and home infusion therapy (50% of revenues) through over
500 locations serving patients in all 50 states. Revenues for the
twelve months ended December 31, 2012 approximated $2.4 billion.
Apria is owned by private equity funds affiliated with the
Blackstone Group.
ARCAPITA BANK: Panel Agrees to Dismiss Expedited Discovery Motion
-----------------------------------------------------------------
In a notice, counsel for Arcapita Bank B.S.C.(c), et al., and the
Official Committee of Unsecured Creditors inform the Bankruptcy
Court that the Debtors and the Committee have agreed to
confidentiality protocols governing the sharing of the information
sought by the Committee in its motion for entry of an order
authorizing expedited discovery from the Debtors. The Committee
motion, filed February 19, seeks access to certain information
regarding the corporate and control rights for the Debtors'
portfolio investments.
Thus, it has been stipulated that pursuant to Rule 41(a)(1)(ii) of
the Federal Rules of Civil Procedure, as made applicable by Rules
9014 and 7041 of the Federal Rules of Bankruptcy Procedure, the
motion is voluntarily dismissed, without prejudice to the
Committee's right to file further motions seeking discovery from
the Debtors.
As reported in the TCR on March 4, 2012, the Debtors oppose the
motion of the Committee for authority to obtain discovery from the
Debtors regarding the corporate and control rights for the
Debtors' portfolio investments.
According to the Debtors, the Committee fully understands the
"control risks the Debtors face," and that the Committee already
has a copy of all documents, including the administration and
management agreements, a form of proxy and other materials through
which the Debtors directly and indirectly administer the Portfolio
Company investments and the Committee well knows the terms upon
which the proxies (entered into between the Investors and
AIML) may be revoked and the other agreements terminated.
The Debtors state that what the Committee specifically seeks is:
i. All proxies executed with respect to any company in the
holding structure (which will identify the investors in the
Syndication Companies);
ii. All documents evidencing a revocation of the Proxies; and
iii. A current share register for each entity in the holding
structure (which will also identify the investors in the
Syndication Companies and SIP Investors).
According to papers filed with the Court, the professionals for
the Committee have informed the Debtors' professionals that the
Committee intends to first (i) disseminate the identity of all Co-
Investors and SIP Investors to the full Committee, including the
Debtors' competitors on the Committee, and then (ii) contact the
Investors directly and solicit their support for the terms of a
post confirmation governance system different from the Debtor's
proposed Plan that excludes the personnel and management with whom
the Investors are familiar.
According to the Debtors, the Committee's motion for an order
pursuant to Rule 2004 should be denied because it:
* Is outside of an order that may be entered pursuant to by Rule
2004 and the Committee has failed to meet its affirmative burden
establishing "cause";
* Violates the Debtors' exclusive right to operate its business
as a debtor in possession;
* Will greatly interfere with and disrupt the economic and
contractual relationships between the Debtors and the Investors
and may well cause the very problem the Committee claims it needs
to understand;
* Will disrupt the Debtors' business and will cause harm to the
value of the Debtors' assets in the event of the revocation of the
Proxies and the resulting breach in lending agreements due to a
"change of control";
* Violates the Debtors' exclusive right to solicit the
acceptance of the proposed Chapter 11 plan now on file;
* Amounts to the Committee's attempt to solicit support of a
Plan outside of an approved disclosure statement; and
* Would require Arcapita Bank to violate Bahraini law and expose
Arcapita Bank and its agents to civil and criminal liability in
Bahrain.
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.
On Feb. 8, 2013, the Debtors filed with the Bankruptcy Court a
disclosure statement in support of their Joint Plan of
Reorganization, dated Feb. 8, 2013. The Plan contemplates, among
others, the entry of the Debtors into a $185 million Murabaha exit
facility that will allow the Debtors to wind down their businesses
and assets for the benefit of all creditors and stakeholders.
ARCAPITA BANK: Disclosure Statement Hearing Adjourned to April 19
-----------------------------------------------------------------
The hearing to consider Arcapita Bank B.S.C.(c), et al.'s motion
for an order: 1) approving the Disclosure Statement and 2) further
extending the Debtors' Exclusive Solicitation Period, previously
scheduled for April 10, 2013, at 11:00 a.m., has been adjourned
until April 19, 2013, at 11:00 a.m. The Hearing may be further
continued or adjourned from time to time without further notice
other than by such adjournment being announced in open
Court or by a notice of adjournment filed with the Court
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.
On Feb. 8, 2013, the Debtors filed with the Bankruptcy Court a
disclosure statement in support of their Joint Plan of
Reorganization, dated Feb. 8, 2013. The Plan contemplates, among
others, the entry of the Debtors into a $185 million Murabaha exit
facility that will allow the Debtors to wind down their businesses
and assets for the benefit of all creditors and stakeholders.
ASARCO LLC: Union Pacific Off The Hook For Superfund Cleanup Fees
-----------------------------------------------------------------
Kathryn Brenzel of BankruptcyLaw360 reported that an Idaho federal
judge on Thursday dismissed Asarco LLC's lawsuit against Union
Pacific Railroad Co. seeking pollutant cleanup payments, saying
the relief claims involving an Idaho Superfund site were released
in the mining company's bankruptcy proceedings.
The report related that U.S. District Judge Edward J. Lodge threw
out the case, finding that the language of a bankruptcy settlement
agreement "clearly and unequivocally" released Union Pacific from
further obligations regarding the Coeur d'Alene Basin, a 1,500-
square-mile area located in northern Idaho and Washington,
according to the ruling.
About Asarco LLC
Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/--
is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent.
ASARCO LLC filed for Chapter 11 protection (Bankr. S.D. Tex. Case
No. 05-21207) on Aug. 9, 2005. Attorneys at Baker Botts
L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented
the Debtor in its restructuring efforts.
On Dec. 9, 2009, Asarco Incorporated and Americas Mining
Corporation's Seventh Amended Plan of Reorganization for the
Debtors became effective and the ASARCO Asbestos Personal Injury
Settlement Trust was created and funded with nearly $1 billion in
assets, including more than $650 million in cash plus a $280
million secured note from Reorganized ASARCO. The Plan, which was
confirmed both by the bankruptcy and district courts, reintegrated
ASARCO LLC back to parent Grupo Mexico concluding the four-year
Chapter 11 proceeding.
ASCEND LEARNING: S&P Lowers CCR to 'CCC' on High Leverage
---------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Burlington, Mass.-based Ascend Learning LLC to 'CCC'
from 'CCC+'. The outlook is negative.
At the same time, S&P is lowering its issue-level ratings on all
existing debt by one notch, in conjunction with its change to the
corporate credit rating. The recovery ratings on this debt remain
unchanged.
Total debt outstanding was roughly $420 million as of Dec. 31,
2012.
The downgrade reflects the company's weaker-than-expected
operating performance, extremely high leverage, negative
discretionary cash flow, and S&P's expectation that the company
will need another amendment to its first-lien credit facility when
the covenant steps down on March 31, 2014, despite S&P's
expectation of modest revenue and EBITDA growth. The December
2012 first-lien amendment provided only near-term covenant relief,
and S&P anticipates that another amendment could be difficult to
obtain unless profitability significantly improves and the trend
of negative discretionary cash flow reverses. The company has
recently implemented cost reductions and is reducing product
development spending, after significant increases in 2012. S&P
sees the risk that the company will continue to earn a less than
satisfactory return on these investments.
Standard & Poor's ratings on Ascend Learning reflect S&P's
expectation that the potential for a resumption of modest EBITDA
growth, supported by slight organic growth and cost reductions,
will not be sufficient to alleviate high leverage. The company
has incurred significant increases in its expenses, in part to
integrate acquisitions, and also for product development and sales
and marketing. S&P considers the company's business risk profile
"weak" (based on S&P's criteria), reflecting its lack of critical
mass, niche focus, acquisition strategy that has involved some
shortcomings in integration, and concentration in health care and
related fields, which are highly fragmented and competitive.
Operating synergies have been difficult to achieve because of
inherent difficulties in managing performance across a growing and
disparate business portfolio. There have been execution missteps
and an abrupt shift in management's growth strategy, which have
recently resulted in the resignation of the company's CEO. Ascend
Learning has a "highly leveraged" financial risk profile, in S&P's
view, because of its debt financing of high-priced acquisitions,
high debt to EBITDA, and a history of special dividends.
Ascend Learning is a provider of educational products with a focus
on health care-related disciplines, professional training, and
testing. The company has a limited scale of operation, a small
size, and competitive threats. Sales of the vocational services
publishing division are declining due to the growth of the rental
textbook market and online retail distribution, which has ncreased
the availability of discounted books. Growth is slowing in the
company's key nursing school test preparation business due to
declining enrollments for practical nurses and associate degree
programs, reflecting the shift in hospitals' preferences towards
four-year registered nurse programs. Also, some of the company's
peers, like Reed Elsevier LLC and the Washington Post Co., are
better-capitalized and, like Ascend, offer test preparation
divisions for the nursing licensing exam. S&P sees the risk that
the business may become price competitive as these players attempt
to gain market share.
AVIV REIT: S&P Raises Corporate Credit Rating to 'BB-'
------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Aviv REIT Inc. and its subsidiaries to 'BB-' from 'B+'
and the senior unsecured issue-level rating to 'BB' from 'B+'.
S&P removed the ratings from CreditWatch positive, where it placed
them on Dec. 19, 2012. S&P also revised the recovery rating on
the senior unsecured notes '2' from '3', indicating S&P's
expectation that noteholders would receive substantial recovery
(70%-90%) in the event of default.
"Our ratings on Aviv reflect a "weak"" business risk profile,
given heavy dependence on government reimbursement programs,
smaller scale and scope than most of the health care peers we
rate, and a seasoned but lean management team," said credit
analyst Matthew Lynam. "We have revised the company's financial
risk profile to "significant" from "aggressive" after Aviv's
initial public offering closed and subsequent repayment of secured
debt. The company will now carry lower leverage, a larger
unencumbered asset base, a longer weighted average debt maturity,
and access to broader sources of capital."
S&P's stable outlook reflects its expectation for relatively
stable cash flow from long-term leases with embedded rent
increases as Aviv pursues a measured expansion of its asset base.
S&P would consider lowering the corporate credit rating if
operator rent coverage falls below 1.2x, perhaps due to tenant
stress resulting from changes in Medicaid reimbursement or failure
to manage cost controls. S&P would also consider a downgrade if
recently improved credit metrics materially weakened.
While S&P do not view an upgrade as likely in the next 12 months,
it may consider raising its rating if Aviv continues to increase
the scale and diversity of its asset base, demonstrates seasoning
as a publicly-traded company, and continues to broaden its equity
base while maintaining stronger than average credit metrics and
healthy tenant rent coverage.
BERNARD L. MADOFF: Trustee Makes 3rd Distribution of $506.2MM
-------------------------------------------------------------
Irving H. Picard, SIPA Trustee for the liquidation of Bernard L.
Madoff Investment Securities LLC, said April 1 that the third pro
rata interim distribution of recoveries from the Customer Fund to
eligible BLMIS customers commenced March 29.
The SIPA Trustee is distributing approximately $506.2 million on a
pro rata basis to BLMIS account holders with allowed claims,
bringing the amount distributed to eligible claimants to $5.44
billion, which includes approximately $807.2 million in committed
advances from the Securities Investor Protection Corporation
(SIPC). When combined with the funds previously returned to BLMIS
customers, the distribution fully satisfies more than 50% of the
total current accounts with allowed claims.
In the third distribution, allowed claim holders will receive
4.721% of the allowed claim amount of each individual account,
unless the claim is fully satisfied. Currently, 2,178 account
holders have allowed claims and, of these account holders, 1,106
will be fully satisfied following the third interim distribution.
The average payment in this distribution is approximately $459,000
and the largest payment is approximately $116 million.
"This distribution is another important milestone in the global
Madoff Recovery Initiative," said Mr. Picard. "Significant
recoveries remain on hold, however, pending appeals and court
rulings. Our twin priorities are not only to continue building
the Customer Fund with additional recoveries, but also to keep
pushing hard for resolutions that will enable further
distributions this year."
"This is one of the most difficult, complex and time-consuming
cases in history and SIPC's deep involvement and its funding of
the litigation have contributed significantly to the recoveries
that have been achieved," said Stephen P. Harbeck, president and
CEO of SIPC. "The SIPA Trustee's priorities are the same as
SIPC's, to recover and distribute funds as quickly as possible to
BLMIS customers with allowed claims."
Funds for the third distribution are drawn primarily from the
allocation of approximately $1.2 billion from the Tremont Funds
settlement and other funds recovered by the SIPA Trustee since the
second interim distribution in September 2012 through Feb. 28,
2013.
"While we cannot predict the timing of the next distribution, we
expect that 2013 will bring significant advances on a number of
legal fronts, particularly in international matters," said David
J. Sheehan, Chief Counsel to the SIPA Trustee. "We are confident
in our legal positions and we look forward to more good news this
year for BLMIS customers."
Approximately $3.626 billion has been distributed to date to BLMIS
accountholders with allowed claims through the second pro rata
interim distribution and approximately $499.8 million through the
first pro rata interim distribution.
The SIPA Trustee has recovered or reached agreements to recover
approximately $9.320 billion since December 2008, representing
more than 53% of the approximately $17.5 billion in principal
estimated to have been lost in the Ponzi scheme by BLMIS customers
who filed claims. These recoveries exceed similar efforts related
to prior Ponzi schemes, in terms of dollar value and percentage of
stolen funds recovered.
One hundred percent of the SIPA Trustee's recoveries will be
allocated to the Customer Fund for distribution to BLMIS customers
with allowed claims. All administrative costs of the SIPA
liquidation of BLMIS have been funded by SIPC. Recoveries for the
Customer Fund are paid to BLMIS customers in accordance with SIPA.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.).
BEST PLUMBING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Best Plumbing Heating & Cooling, Inc.
aka Laurmar Associates
59-05 39th Avenue
Woodside, NY 11377
Bankruptcy Case No.: 13-41827
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Nancy Hershey Lord
Debtor's Counsel: Brian J. Hufnagel, Esq.
FORCHELLI, CURTO, DEEGAN, SCHWARTZ,
MINEO & TERRANA, LLP
The Omni
333 Earle Ovington Boulevard, Suite 1010
Uniondale, NY 11553
Tel: (516) 248-1700
Fax: (516) 248-1729
E-mail: BHufnagel@forchellilaw.com
Estimated Assets: not indicated
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/nyeb13-41827.pdf
The petition was signed by Frederic Davis.
BIRDSALL SERVICES: NJ Engineering Firm Indicted, Files Chapter 11
-----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Birdsall Services Group Inc., an engineering firm
from Eatontown, New Jersey, filed for Chapter 11 protection
(Bankr. D.N.J. Case No. 13-16743) on March 29 when the state
attorney general indicted the business and obtained a court order
seizing the assets.
The company said in a court filing that none of its officers
accused of wrongdoing is still employed. Chapter 11 was necessary
to free cash to cover payroll for 325 workers, Birdsall said. A
company officer pleaded guilty last year to making political
contributions disguised to appear as though made by individuals.
The Chapter 11 petition filed in Trenton, New Jersey, disclosed
assets of $41.6 million and liabilities totaling $27 million.
Debt includes $3.6 million owing to a bank on a secured claim and
$2.4 million in payables to trade suppliers.
BIRDSALL SERVICES: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Birdsall Services Group, Inc.
611 Industrial Way West
Eatontown, NJ 07724
Bankruptcy Case No.: 13-16743
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
District of New Jersey (Trenton)
Judge: Michael B. Kaplan
Debtors' Counsel: David H. Stein, Esq.
WILENTZ, GOLDMAN & SPITZER, P.A.
90 Woodbridge Center Drive
P.O. Box 10
Woodbridge, NJ 07095
Tel: (732) 636-8000
Fax: (732) 855-6117
E-mail: dstein@wilentz.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
BSG Engineering, Surveying and
Landscape Architecture LLC 13-16746
Assets: $0 to $50,000
Debts: $1,000,001 to $10,000,000
The petitions were signed by John L. Wuestneck, chief operating
officer.
A. A copy of Birdsall Services Group's list of its 20 largest
unsecured creditors filed with the petition is available for free
at http://bankrupt.com/misc/njb13-16743.pdf
B. A copy of BSG Engineering's list of its 20 largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/njb13-16746.pdf
BONANZA CREEK: Moody's Gives B2 CFR & Rates New $250MM Notes 'B3'
-----------------------------------------------------------------
Moody's Investors Service assigned a first time B2 Corporate
Family Rating to Bonanza Creek Energy, Inc., a B2-PD Probability
of Default Rating and a B3 rating to its proposed offering of $250
million senior unsecured notes. Moody's also assigned an SGL-3
Speculative Grade Liquidity reflecting adequate liquidity. The net
proceeds of this inaugural debt offering will be used to repay
outstanding borrowings under the company's revolving credit
facility and for general corporate purposes. The rating outlook is
stable.
Ratings assigned:
Corporate Family Rating, B2
Senior Unsecured Notes Rating, B3, LGD-5 (76%)
Probability of Default Rating, B2-PD
Ratings Rationale:
"The notes offering will provide the capital to further fund the
rapid pace of development of Bonanza Creek's roughly 31,700 net
acres in Colorado's Wattenberg Field," noted Andrew Brooks,
Moody's Vice President. "The high oil content from Wattenberg
production yields attractive cash margins and provides substantial
growth opportunities for Bonanza Creek, while leverage metrics are
expected to increase although remaining at a level that is
appropriate for the B2 rating."
The B2 CFR reflects Bonanza Creek's relatively small size in terms
of production and reserves, while acknowledging the significant
growth opportunities embedded in the company's acreage. The rating
also reflects the company's strong cash margins from the high
liquids content of its production both in its Rocky Mountain and
Mid-Continent acreage, while factoring in the significant capital
that is needed to further capitalize on the oil potential of its
Wattenberg holdings. Bonanza Creek expects to outspend cash flow
in 2013 and beyond, debt financing future deficits as it continues
to grow production. While Moody's expects debt levels to increase,
relative debt leverage should remain at modest levels. The company
operates 99% of its proved reserves, providing a high degree of
operational control, and affording it the flexibility to manage
down its spending should market conditions pressure it to do so.
Bonanza Creek was established in 2006 and completed an Initial
Public Offering in December 2011. Proved reserves totaled 53
million barrels of oil equivalent (mmBoe) as of December 31, 2012
(45% proved developed, 57% crude oil), 61% of which are located in
the Rocky Mountain region, predominately in the Wattenberg Field's
Niobrara Shale. The remaining reserves are in the oil-bearing
Cotton Valley sands in southern Arkansas where its 13,400 net
acreage is fully held by production. The company also owns
midstream assets that support its Mid-Continent operations.
Bonanza Creek's 2012 production averaged 9,400 Boe per day, 65% of
which was crude oil, with production evenly split between its
Rocky Mountain and Mid-Continent regions. The company's December
2012 exit rate approximated 12,500 Boe per day, with full year
production up 115% over 2011. Reflecting the high liquids content
of its production, Bonanza Creek's 2012 unlevered cash margin
averaged a very strong $45.54 per Boe.
Bonanza Creek's SGL-3 rating reflects Moody's view of adequate
liquidity through 2014. The company will use the proceeds of its
inaugural bond offering to pay down all outstanding borrowings
under its revolving credit facility. Moody's expects the company's
anticipated $394 million capital budget to create a cash flow
deficit approximating $150 million in 2013, which will be funded
by its revolving credit facility. The $600 million committed
revolving credit facility provides for a $325 million borrowing
base, which is expected to be reduced to $262.5 million following
the notes issue. The revolver is scheduled to mature in September
2016, and is secured by all assets. It requires the company to
maintain a current ratio of at least 1x and a leverage ratio
(debt/EBITDAX) of less than 4x. Moody's does not foresee any
covenant issues through 2014.
The B3 rating on the proposed $250 million of senior unsecured
notes reflects both the overall probability of default of Bonanza
Creek, to which Moody's assigns a PDR of B2-PD, and a Loss Given
Default of LGD5 (76%). The size of the potential senior secured
claims relative to the senior unsecured notes results in the
senior notes being rated one notch below the B2 CFR under Moody's
Loss Given Default Methodology.
The rating outlook is stable, reflecting Moody's expectation that
Bonanza Creek will make relatively modest use of leverage to fund
its growth, maintaining debt to average daily production under
$30,000 per Boe. An upgrade would be considered should Bonanza
Creek grow production approaching 30,000 Boe per day while holding
debt to average daily production below $25,000 per Boe. The rating
could be downgraded if the company's drilling program in the
Wattenberg fails to produce substantial results in 2013, or should
debt leverage increase to over $30,000 per Boe of average daily
production on a sustained basis.
The principal methodology used in this rating was Global
Independent and Production Industry published in December 2011.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Bonanza creek Energy, Inc. is an independent exploration and
production company headquartered in Denver, Colorado.
BONTEN MEDIA: S&P Affirms CCC Corp Credit Rating; Outlook Negative
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'CCC' corporate
credit rating on U.S. TV broadcaster Bonten Media Group Inc. The
outlook is negative.
At the same time, S&P revised its recovery rating on the company's
9% subordinated toggle notes due 2015 to '5', indicating its
expectation for modest (10% to 30%) recovery for subordinated
noteholders in the event of a payment default, from '6' (0% to 10%
recovery expectation). S&P subsequently raised its issue-level
rating on this debt to 'CCC-' (one notch lower than the corporate
credit rating) from 'CC', in accordance with S&P's notching
criteria.
"The change reflects our expectation that TV station sales
multiples will remain stable over the next 12 to 18 months," said
Standard & Poor's credit analyst Minesh Patel.
S&P's 'CCC' rating on New York-based TV broadcaster Bonten Group
Inc. reflects the company's "highly leveraged" financial risk
profile and "weak" liquidity. In S&P's opinion, over the next 12
to 15 months, as the company seeks to refinance its senior secured
term loans, Bonten will likely consider a subpar exchange or debt-
for-equity offer for its 9% senior subordinated notes to lower its
debt and interest burden.
S&P's opinion is based on the following expectations and
assumptions:
-- A meaningful increase in interest rates would cause
discretionary cash flow to decline to minimal or negative
levels, leaving the company vulnerable to declines in the
business cycle and an economic recession, threatening, in
S&P's view, the company's solvency. We expect a refinancing
at current interest rates could increase the secured term
loan margin by as much as 3% to 5% from the current low rate
of LIBOR plus 2.5%, and increase the interest rate on the 9%
subordinated notes to its current yield-to-maturity of about
13%.
-- The 9% subordinated notes indenture allow for a meaningful
increase in incremental priority debt baskets. This
provides the company with additional options to lower its
cost of debt financing by layering new lower-cost senior
priority debt, or to implement coercive restructuring
initiatives to extend maturities or lower its debt burden.
-- Meaningful stockholder deficits combined with Diamond
Castle's incentives to limit investment losses leads to, in
S&P's view, the acceptance of high risk tolerance to
aggressively grow Bonten's operating platform, to seek
additional capital to support balance sheet deleveraging
acquisitions, and to seek creative restructuring
alternatives to reduce its debt and interest burden to
maximize equity value.
BRIGHTER DAYS: Case Summary & 13 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Brighter Days Solar Energy LLC
fdba Ampray
206 13th Avenue North
Greenwood, MO 64034
Tel: (816) 721-4991
Bankruptcy Case No.: 13-41123
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Western District of Missouri (Kansas City)
Debtor's Counsel: Wainsworth Anderson, Esq.
ANDERSON LAW GROUP, LLC
6430 Troost Avenue
Kansas City, MO 64131
Tel: (816) 838-8288
Fax: (816) 886-0034
E-mail: wainswortha@hotmail.com
Scheduled Assets: $1,636,366
Scheduled Liabilities: $887,081
A copy of the Company's list of its 13 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/mowb13-41123.pdf
The petition was signed by Edward Anthony Glaser, member.
BYTEC INC: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: ByTec, Inc.
839 N. Rochester Road
Clawson, MI 48017
Bankruptcy Case No.: 13-46229
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Eastern District of Michigan (Detroit)
Judge: Walter Shapero
Debtor's Counsel: Lynn M. Brimer, Esq.
STROBL & SHARP, PC
300 East Long Lake Road
Suite 200
Bloomfield Hills, MI 48304
Tel: (248) 540-2300
E-mail: lbrimer@stroblpc.com
Scheduled Assets: $678,831
Scheduled Liabilities: $3,701,443
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/mieb13-46229.pdf
The petition was signed by Lawrence A. Zak, CFO.
C.R.S. SERVICE: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: C.R.S. Service Company Inc.
dba Faith Christian School & Day Care
11089 West Sprague Road
North Royalton, OH 44133
Bankruptcy Case No.: 13-12006
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Northern District of Ohio (Cleveland)
Judge: Arthur I. Harris
Debtor's Counsel: Wade Travis Doerr, Esq.
BERNLOHR, NIEKAMP & WEISENSELL, LLP
The Nantucket Building, Third Floor
23 South Main Street
Akron, OH 44308
Tel: (330) 434-1000
Fax: (330) 434-1001
E-mail: wade@b-wlaw.com
- and ?
Christopher J. Niekamp, Esq.
BERNLOHR, NIEKAMP & WEISENSELL, LLP
23 S. Main Street, Third Floor
Akron, OH 44308
Tel: (330) 434-1000
Fax: (330) 434-1001
E-mail: cjn@b-wlaw.com
Scheduled Assets: $61,050
Scheduled Liabilities: $1,701,464
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ohnb13-12006.pdf
The petition was signed by Frank A. Scavone, president.
CASPIAN SERVICES: Amends Bylaws to Reflect Company Changes
----------------------------------------------------------
The board of directors of Caspian Services, Inc., adopted
amendments to the Company's Bylaws in accordance with Article IX
of the Company's Bylaws. The amendments were adopted to reflect
changes in the Company since the adoption of the previous Bylaws,
for the efficient operation of the Company and to bring the Bylaws
more into compliance with current Nevada corporate law, including
amendments:
* to change the date of the annual meeting of shareholders from
June 1 of each year to March 1 of each year;
* to grant the board to right to allow Company shareholders to
participate in shareholder meetings by telephone;
* to increase the range of the number of Company directorships
from one to seven to one to nine;
* to allow for electronic transmission of notices to
shareholders; and
* other revisions to clarify the language of the Company's
Bylaws and to bring them more into compliance with current
Nevada corporate law.
A copy of the Amended Bylaws is available at http://is.gd/85N0Z5
About Caspian Services
Headquartered in Salt Lake City, Caspian Services, Inc., was
incorporated under the laws of the state of Nevada on July 14,
1998. Since February 2002 the Company has concentrated its
business efforts to provide diversified oilfield services to the
oil and gas industry in western Kazakhstan and the Caspian Sea,
including providing a fleet of vessels, onshore, transition zone
and marine seismic data acquisition and processing services and a
marine supply and support base in the port of Bautino, in Bautino
Bay, Kazakhstan.
At Dec. 31, 2012, the Company's balance sheet showed $86.1 million
in total assets, $86.9 million in total liabilities, and a
stockholders' deficit of $768,000.
Going Concern Uncertainty
Under the terms of the EBRD Loan Agreement, as amended, Balykshi
LLP, the Company's majority owned subsidiary, is required to repay
the loan principal and accrued interest in eight equal semi-annual
installments commencing Nov. 20, 2011, and then occurring each
May 20 and November 20 thereafter until fully repaid. The first
three semi-annual repayment installments, due Nov. 20, 2011,
May 20, 2012, and Nov. 20, 2012, were not made.
Additionally, an event of default may trigger the acceleration
clause in the Put Option Agreement with EBRD which would allow
EBRD to put its $10,000,000 investment in Balykshi back to the
Company. If EBRD were to accelerate its put right, the Company
could be obligated to repay the initial investment plus a 20%
annual rate of return. The balance of accelerated put option
liability was $18,326,000 and $17,822,000 as of Dec. 31, 2012, and
Sept. 30, 2012.
EBRD also previously notified the Company that it believes the
Company and Balykshi are in violation of certain other covenants
of the EBRD financing agreements. As of Feb. 19, 2013, to the
Company's knowledge, EBRD has not sought to accelerate repayment
of the loan or the put option.
Should EBRD determine to exercise its acceleration rights or
should the Loan Restructuring Agreement with an otherwise
unrelated individual (the "Investor") not close, the Company
currently has insufficient funds to repay its obligations to
Investor or EBRD individually or collectively and would be forced
to seek other sources of funds to satisfy these obligations.
Given the Company's current and near-term anticipated operating
results, the difficult credit and equity markets and the Company's
current financial condition, the Company believes it would be very
difficult to obtain new funding to satisfy these obligations. If
the Company is unable to obtain funding to meet these obligations,
Investor and or EBRD could seek any legal remedies available to
them to obtain repayment, including forcing the Company into
bankruptcy, or in the case of the EBRD loan, which is
collateralized by the assets, including the marine base, and bank
accounts of Balykshi and Caspian Real Estate, Ltd, foreclosure by
EBRD on such assets and bank accounts.
"The ability of the Company to continue as a going concern is
dependent upon, among other things, its ability to successfully
negotiate and conclude restructured financing agreements with EBRD
and the Investor and its ability to generate sufficient revenue
from operations, or to identify a financing source that will
provide the Company the ability to satisfy its repayment and
guarantee obligations under the restructured financing agreements.
Uncertainty as to the outcome of these factors raises substantial
doubt about the Company's ability to continue as a going concern,"
the Company said in its quarterly report for the period ended
Dec. 31, 2012.
CELL THERAPEUTICS: Inks Severance Pact with Matthew Plunkett
------------------------------------------------------------
The Compensation Committee of the Board of Directors of Cell
Therapeutics, Inc., approved the Company's entering into a
severance agreement with Dr. Matthew Plunkett, the Company's
Executive Vice President, Corporate Development. The Severance
Agreement provides that if Dr. Plunkett is discharged from
employment by the Company without cause or resigns for good
reason, he will receive the following severance benefits:
(i) cash severance equal to 18 months of his base salary, plus
an amount equal to the greater of the average of his three
prior years' bonuses or 30% of his base salary;
(ii) reimbursement for up to 18 months by the Company for COBRA
premiums to continue his medical coverage and that of his
eligible dependents; and
(iii) continued payment for up to 18 months by the Company of
premiums to maintain life insurance paid for by the Company
at the time of his termination.
In addition, Dr. Plunkett would be entitled to accelerated vesting
of all of his then-outstanding and unvested stock-based
compensation. Dr. Plunkett's right to receive these severance
benefits is conditioned upon his executing a release of claims in
favor of the Company and not breaching his inventions and
proprietary information agreement with the Company.
A copy of the Severance Agreement is available for free at:
http://is.gd/IXmzbB
The Company previously adopted a long-term incentive program,
effective as of Jan. 3, 2012, that provided for grants of
performance-based equity awards to the Company's executive
officers and directors. The awards currently outstanding under
the program were granted to James A. Bianco, the Company's chief
executive officer and president; Louis A. Bianco, the Company's
executive vice president, Finance and Administration; and Jack W.
Singer, M.D., the Company's executive president, Global Medical
Affairs and Translational Medicine. In addition, each of the
Company's directors who are not employed by the Company, including
John H. Bauer, Vartan Gregorian, Richard L. Love, Mary O.
Mundinger, Phillip N. Nudelman, Frederick W. Telling and Reed V.
Tuckson, holds an outstanding award under the program. These
awards are scheduled to expire on Dec. 31, 2014, to the extent the
related performance goals have not been attained.
On March 21, 2013, the Compensation Committee approved, for the
awards held by executive officers, an extension of the performance
period by one year to Dec. 31, 2015, and several modifications to
the program, and the Board of Directors approved similar changes
for the awards held by the Non-Employee Directors.
A full-text copy of the Form 8-K is available for free at:
http://is.gd/IXmzbB
About Cell Therapeutics
Headquartered in Seattle, Washington, Cell Therapeutics, Inc.
(NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is
a biopharmaceutical company committed to developing an integrated
portfolio of oncology products aimed at making cancer more
treatable.
Cell Therapeutics incurred a net loss attributable to common
shareholders of $115.27 million for 2012, as compared
with a net loss attributable to common shareholders of
$121.07 million for 2011. The Company's balance sheet at Dec. 31,
2012, showed $73.71 million in total assets, $27.30 million in
total liabilities, $13.46 million in common stock purchase
warrants, and $32.94 million in total shareholders' equity.
The Company's independent registered public accounting firm
included an explanatory paragraph in its reports on the Company's
consolidated financial statements for each of the years ended
Dec. 31, 2007, through Dec. 31, 2011, regarding their substantial
doubt as to our ability to continue as a going concern. Although
the Company's independent registered public accounting firm
removed this going concern explanatory paragraph in its report on
our Dec. 31, 2012, consolidated financial statements, the Company
expects to continue to need to raise additional financing to fund
its operations and satisfy obligations as they become due. The
inclusion of a going concern explanatory paragraph in future years
may negatively impact the trading price of the Company's common
stock and make it more difficult, time consuming or expensive to
obtain necessary financing, and the Company cannot guarantee that
it will not receive such an explanatory paragraph in the future.
Bankruptcy Warning
"We have licensed intellectual property from third parties,
including patent applications relating to intellectual property
for PIXUVRI, pacritinib, tosedostat, and brostallicin. We have
also licensed the intellectual property for our drug delivery
technology relating to Opaxio which uses polymers that are linked
to drugs, known as polymer-drug conjugates. Some of our product
development programs depend on our ability to maintain rights
under these licenses. Each licensor has the power to terminate
its agreement with us if we fail to meet our obligations under
these licenses. We may not be able to meet our obligations under
these licenses. If we default under any license agreement, we may
lose our right to market and sell any products based on the
licensed technology and may be forced to cease operations,
liquidate our assets and possibly seek bankruptcy protection.
Bankruptcy may result in the termination of agreements pursuant to
which we license certain intellectual property rights, including
the rights to PIXUVRI, pacritinib, Opaxio, tosedostat, and
brostallicin," the Company said in its annual report for the year
ended Dec. 31, 2012.
CENTRAL EUROPEAN: Copy of Rejected Mark Kaufman Proposal
--------------------------------------------------------
Central European Distribution Corporation filed an amended current
report on Form 8-K/A to attach Exhibit 99.1 to the Current Report
on Form 8-K filed with the United States Securities and Exchange
Commission on March 22, 2013.
On March 21, 2013, the board of directors of CEDC received a
revised proposal from a consortium including A1 Investment
Company, Dr. Mark Kaufman and the SPI Group in respect of a
restructuring of CEDC's financial obligations. A copy of this
proposal is available for free at http://is.gd/3gNO4B
The Board of Directors, together with its advisors, has reviewed
the terms of this revised proposal and the Board of Directors does
not believe that this proposal is competitive with the terms of
the proposal made by Roust Trading Ltd. and reflected in
Supplement No. 1 to the Amended and Restated Offering Memorandum,
Consent Solicitation Statement and Disclosure Statement and
affirms its support for the transactions described in this
supplement.
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.
CHARTER COMMUNICATIONS: Fitch Assigns 'BB+' Senior Secured Rating
-----------------------------------------------------------------
Fitch Ratings has assigned a 'BB+' senior secured rating to
Charter Communications Operating, LLC's proposed seven-year, $1.5
billion term loan E. Proceeds from the term loan, along with a
draw from CCO's revolver are expected to be used to fund the
previously announced $1.625 billion acquisition of Bresnan
Broadband Holdings, LLC. CCO is an indirect wholly owned
subsidiary of Charter Communications, Inc. As of Dec. 31, 2012,
Charter had approximately $12.9 billion of debt (principal value)
outstanding including $3.3 billion of senior secured debt.
KEY RATING DRIVERS:
-- The terms and conditions of term loan E are substantially
similar to the existing senior secured credit facility;
-- Charter's target leverage ratio remains between 4x and 4.5x;
-- Acquisition of Bresnan is neutral to Charter's ratings;
-- Bresnan acquisition fits strategically and will not generate
meaningful cost synergies or present integration risks;
-- Expected improvement in Charter's credit profile likely
delayed by Bresnan acquisition.
Fitch's ratings incorporate Charter's pending acquisition of
Bresnan Broadband Holdings, LLC for $1.625 billion in cash. Fitch
anticipates the debt-funded acquisition will modestly increase
Charter's leverage; however, leverage will remain within Fitch's
expectations for the rating. Charter's leverage will increase to
approximately 5.0x on a pro forma basis as of the latest 12 months
(LTM) ending Dec. 31, 2012 after giving consideration for the
incremental debt associated with the proposed transaction and
Bresnan's EBITDA generation. Actual leverage as of Dec. 31, 2012
was 4.75x.
Charter's capital structure and financial strategy remains
consistent and centers on simplifying its debt structure, and
extending its maturity profile while reducing leverage to its
target range of 4x to 4.5x. Pro forma leverage remains outside the
company's target at 5.0x for the LTM period ended Dec. 31, 2012.
The incremental debt associated with the acquisition will slow the
pace of expected improvement of Charter's credit profile during
2013. Fitch now anticipates Charter's leverage will remain close
to 5x at the end of 2013 before declining somewhat to 4.6x by the
end of 2014.
Bresnan operates cable systems in Montana, Wyoming, Colorado and
Utah passing approximately 666,000 homes. The acquisition is in
line with Charter's strategy to provide service in largely
secondary and rural markets. However, Bresnan's cable service area
does not complement Charter's existing service footprint so the
acquisition will not generate any meaningful operational synergies
(outside of programming cost savings) or create integration risks.
From Fitch's perspective Bresnan has a relatively strong operating
profile. Bresnan's service penetration rates, revenue and EBITDA
growth metrics are stronger than Charter's.
Fitch believes that Charter has sufficient capacity within the
current ratings to accommodate changes to the company's operating
strategy and plans to maintain a higher level of capital
expenditures (relative to historical norms and peer comparisons).
In Fitch's opinion, the strategy shift along with higher level of
capital expenditures will lead to a stronger overall competitive
position. The changes to Charter's operating strategy support the
company's overall strategic objectives, and set the foundation for
sustainable growth while creating more efficient operating
profile. However, Fitch expects the strategy will hinder free cash
flow (FCF) generation and strain EBITDA margins during 2013,
limiting overall financial flexibility and slowing the company's
progress to achieving its leverage target. In the short term,
Fitch believes that customer connections, revenue and expense
metrics will be negatively affected.
Charter generated approximately $131 million of FCF during the
year ended 2012, down markedly from the $426 million of FCF
produced during the year ended 2011. Charter's more viable capital
structure has positioned the company to generate positive FCF.
However, Fitch expects FCF generation during 2013 will suffer from
the effects of lower operating margin and higher capital
intensity. Capital expenditures during 2012 increased 33% relative
to last year to approximately $1.8 billion representing 23% of
revenues. Fitch believes capital intensity will remain elevated
during 2013 and 2014. Fitch anticipates Charter will generate
between $250 million and $300 million of FCF during 2013 and
produce between $450 million to $500 million during 2014 when
stronger margins return.
Rating concerns center on Charter's elevated financial leverage
(relative to other large cable MSOs), along with a comparatively
weaker subscriber clustering and operating profile. Moreover,
Charter's ability to adapt to the evolving operating environment
while maintaining its competitive position given the challenging
competitive environment and weak housing and employment trends
remains a key consideration.
Charter's liquidity position is adequate given the current rating
and is supported by cash on hand, borrowing capacity from CCO's
$1.15 billion revolver (approximately $960 million was available
as of Dec. 31, 2012 and $835 million adjusted for the Bresnan
acquisition) and expected FCF generation. Charter's revolver
commitment expires on April 11, 2017.
Charter has successfully extended its maturity profile, as only
5.9% of outstanding debt as of Dec. 31, 2012 is scheduled to
mature before 2016, including $260 million and $411 million during
2013 and 2014, respectively. Previous capital market activity
addressed the refinancing risk related to 2016 scheduled
maturities. Pro forma for CCO Holdings, LLC issuance in
February 2013, 2016 scheduled maturity is reduced to approximately
$591 million from $1.6 billion as of Dec. 31, 2012.
RATING SENSITIVITIES:
-- Positive rating actions would be contemplated as leverage
declines below 4.5x;
-- The company demonstrates progress in closing gaps relative to
its industry peers on service penetration rates and strategic
bandwidth initiatives;
-- Operating profile strengthens as the company captures
sustainable revenue and cash flow growth envisioned when
implementing the current operating strategy.
-- Fitch believes negative rating actions would likely coincide
with a leveraging transaction that increases leverage beyond
5.5x in the absence of a credible deleveraging plan;
-- Adoption of a more aggressive financial strategy;
-- A perceived weakening of Charter's competitive position or
failure of the current operating strategy to produce
sustainable revenue and cash flow growth along with
strengthening operating margins.
COMPREHENSIVE CLINICAL: Case Summary & Creditors List
-----------------------------------------------------
Debtor: Comprehensive Clinical Development, Inc.
3100 145th Avenue, Suite 340
Hollywood, FL 33027
Bankruptcy Case No.: 13-17273
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Southern District of Florida (Fort Lauderdale)
Judge: John K. Olson
Debtors' Counsel: Jacqueline Calderin, Esq.
EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive, #300
Miami, FL 33131
Tel: (305) 722.2002
Fax: (305) 722.2001
E-mail: jc@ecclegal.com
- and ?
Nicole M. Grimal, Esq.
EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive, # 300
Miami, FL 33131
Tel: (305) 722-2002
E-mail: ng@ecclegal.com
- and ?
Robert P. Charbonneau, Esq.
EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive, #301
Miami, FL 33131
Tel: (305) 722-2002
Fax: (305) 722-2001
E-mail: rpc@ecccounsel.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
Comprehensive Clinical Development NW, Inc. 13-17282
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
The petitions were signed by James D. Utterback, president & CEO.
A. A copy of Comprehensive Clinical Development, Inc.'s list of
its 20 largest unsecured creditors filed with the petition is
available for free at http://bankrupt.com/misc/flsb13-17273.pdf
B. A copy of Comprehensive Clinical Development NW's list of its
20 largest unsecured creditors filed with the petition is
available for free at http://bankrupt.com/misc/flsb13-17282.pdf
CONSOLIDATED CAPITAL: Incurs $449,000 Net Loss in 2012
------------------------------------------------------
Consolidated Capital Institutional Properties/2, LP, filed on
March 13, 2013, its annual report on Form 10-K for the year ended
Dec. 31, 2012. Ernst & Young LLP, in Greenville, South Carolina,
noted that the Partnership Agreement provides for the Partnership
to terminate on Dec. 31, 2013. "This raises substantial doubt
about the Partnership's ability to continue as a going concern."
The Partnership reported a net loss of $449,000 on $2.6 million on
revenues in 2012, compared with a net loss of $595,000 on
$2.5 million of revenues in 2011.
The Partnership's balance sheet at Dec. 31, 2012, showed
$9.1 million in total assets, $11.7 million in total liabilities,
and a stockholders' deficit of $2.6 million.
A copy of the Form 10-K is available at http://is.gd/ZEIVDN
Greenville, South Carolina-based Consolidated Capital
Institutional Properties/2, LP, currently owns and operates one
residential investment property. The general partner of the
Partnership is ConCap Equities, Inc.
The Partnership Agreement provides that the Partnership is to
terminate on Dec. 31, 2013, unless terminated prior to such date.
The Partnership Agreement also provides that the term of the
Partnership cannot be extended beyond the termination date. The
General Partner is currently evaluating its plans with respect to
the Partnership's investment property, which may include a sale to
a third party or continuing operations past the expiration date
until the property is sold.
The Partnership has no employees. Management and administrative
services are performed by the General Partner and by agents
retained by the General Partner. An affiliate of the General
Partner has been providing such property management services.
COTO INVESTMENTS: Case Summary & 4 Unsecured Creditors
------------------------------------------------------
Debtor: Coto Investments, Inc.
20 Robin Ridge
Aliso Viejo, CA 92656
Bankruptcy Case No.: 13-12634
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Central District of California (Santa Ana)
Judge: Theodor Albert
Debtor's Counsel: Robert P. Goe, Esq.
GOE & FORSYTHE, LLP
18101 Von Karman, Suite 510
Irvine, CA 92612
Tel: (949) 798-2460
Fax: (949) 955-9437
E-mail: kmurphy@goeforlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its four largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/cacb13-12634.pdf
The petition was signed by Tory O'Cairns, chief financial officer.
CROWNROCK L.P.: Moody's Lifts CFR to 'B3'; Outlook Stable
---------------------------------------------------------
Moody's Investors Service upgraded CrownRock, L.P.'s Corporate
Family Rating and Probability of Default Rating to B3 and B3-PD
from Caa1 and Caa1-PD, respectively. Moody's also assigned a Caa1
rating to CrownRock's proposed senior unsecured notes due 2021.
Note proceeds will be used to repay the full amount outstanding
under its revolving credit facility and its $150 million senior
unsecured notes due 2016 and fund its drilling program. The
outlook is stable.
"The upgrade of Crownrock's CFR to B3 reflects the company's
rapidly improving scale, a longer track record in the Permian
Basin, and strong returns due to a high proportion of oil
production and modest finding and development costs," commented
Arvinder Saluja, Moody's Analyst.
Ratings upgraded:
Issuer: CrownRock, L.P.
Corporate Family Rating, B3 from Caa1
Probability of Default Rating, B3-PD from Caa1-PD
$150 million Senior Unsecured Notes due 2016, Caa1 (LGD5, 74%)
from Caa2 (LGD5, 63%)*
* Rating will be withdrawn at the conclusion of the notes tender
offer
Ratings assigned:
$350 million Senior Unsecured Notes, Caa1 (LGD5, 74%)
Rating Rationale:
The B3 Corporate Family Rating reflects CrownRock's modest scale,
large percentage of oil production, strong margins, and
management's track record of growing reserves and production in
the Permian Basin. The company's vertical drilling activities in
the Permian, a well-known, long-lived oil field, entail lower
operating risk as compared to similarly rated peers. CrownRock has
a high concentration in the Permian, accounting for nearly all its
proved reserves and its PV-10 value. CrownRock's B3 CFR also
considers its high leverage, especially debt to average daily
production metric proforma for the proposed notes. Moody's expects
an improvement in leverage as CrownRock continues to grow its
scale and funds most of its drilling program through internally
generated cash flow. However, improvement in leverage may be
limited as CrownRock has only about 37% of its Wolfberry acreage
either owned or held by production and thus will need to drill to
hold on to leases and grow production. In addition, about 68% of
CrownRock's total reserves are proved undeveloped, and developing
these reserves will be capital intensive and may raise its finding
and development (F&D) costs.
The Caa1 rating on the proposed senior notes reflects both the
overall probability of default of CrownRock, to which Moody's
assigns a PDR of B3-PD, and a loss given default of LGD 5 (74%).
The company has a $500 million senior secured revolving credit
facility with a borrowing base of $340 million. The senior notes
are unsecured and therefore subordinated to the senior secured
credit facility's potential priority claim to the company's
assets. The size of the potential senior secured claims relative
to the unsecured notes outstanding results in the senior notes
being notched below the B3 CFR under Moody's Loss Given Default
Methodology.
CrownRock has good liquidity. The company expects to continue to
outspend its cash flows at least through mid-2014. However, its
cash balance and availability on its revolving credit facility
should provide more than adequate liquidity to cover any
shortfall. Pro forma for the $350 million debt issuance, CrownRock
had $165 million of cash and full availability under on its credit
facility, as of December 31, 2012. The company's credit facility
has a $500 million commitment with a current borrowing base of
$340 million and matures in April 2016. The revolver contains
three financial covenants: debt / EBITDAX of no more than 4.0x,
EBITDAX / interest expense of not less than 3.0x and a current
ratio of not less than 1.0x. CrownRock was well within compliance
at December 31, 2012. Substantially all of CrownRock's assets are
pledged as security under the credit facility which limits the
extent to which asset sales could provide a source of additional
liquidity if needed.
CrownRock could be considered for an upgrade if rising production
lowers debt-to-average daily production to below $30,000/boe with
an average daily production of over 20 mboe. CrownRock could be
downgraded if the company falls short on its drilling program so
that its debt-to-average daily production increases sustainably to
around $50,000/boe, or if liquidity deteriorates. A negative
rating action could also result if CrownRock makes sizeable
distributions that hamper the company's ability to grow as planned
to its owners.
The principal methodology used in this rating was Global
Independent Exploration and Production Industry published in
December 2011. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.
Headquartered in Midland, Texas, CrownRock, L.P. is a privately
held limited partnership that engages in the exploration and
production of crude oil and natural gas in Texas, New Mexico, and
Utah. It is owned by Lime Rock Partners, a private equity firm
(roughly 60% ownership), and management (40%).
CUMULUS MEDIA: Slow Repayment Rate Cues Moody's to Lower Ratings
----------------------------------------------------------------
Moody's Investors Service downgraded Cumulus Media, Inc.'s
Corporate Family Rating to B2 from B1 and Probability of Default
Rating to B2-PD from B1-PD. Moody's also downgraded the company's
2nd lien senior secured term loan to B3 from B2 and 7.75% senior
notes to Caa1 from B3.
The downgrades reflect Moody's view that the pace of debt
repayment and delevering will be slower than expected. Although
EBITDA for 4Q2012 reflects growth over the same period in the
prior year, results fell short of Moody's expectations. Moody's
affirmed the Ba2 rating on the 1st lien senior secured credit
facilities. The outlook is changed to Stable from Negative.
Downgrades:
Issuer: Cumulus Media Inc.
Corporate Family Rating (CFR): Downgraded to B2 from B1
Probability of Default Rating (PDR): Downgraded to B2-PD from B1-
PD
Issuer: Cumulus Media Holdings Inc.
2nd lien sr secured term loan due 2019 ($790 million outstanding):
Downgraded to B3, LGD4 -- 68% from B2, LGD4 66%
7.75% sr notes due 2019 ($610 million outstanding): Downgraded to
Caa1, LGD6 -- 90% from B3, LGD5 - 89%
Affirmed:
Issuer: Cumulus Media Holdings Inc.
1st lien sr secured revolver due 2016 ($300 million commitment):
Affirmed Ba2, LGD2 -- 22%
1st lien sr secured term loan due 2018 ($1,322 million
outstanding): Affirmed Ba2, LGD 2 -- 22%
Outlook Actions:
Issuer: Cumulus Media Inc.
Outlook, Changed to Stable from Negative
Ratings Rationale:
The company's B2 corporate family rating reflects high debt-to-
EBITDA of 7.1x (including Moody's standard adjustments, and
treating preferred shares as 75% debt) for LTM December 31, 2012.
Although improved from a recent peak of 7.4x debt-to-EBITDA,
leverage remains elevated due in part to revenue and EBITDA
falling below expected levels in the three months ended December
31, 2012. Furthermore, management indicates that pacing reports
for 1Q2013 are down 2% due to weak consumer spending and the
deferral of orders by larger advertisers further extending the
time needed to improve operating performance. Despite more
positive pacing reports for 2Q2013, debt ratings are pressured by
challenges related to turning around 10 underperforming stations
in eight of its larger markets which are expected to breakeven
only in the second half of 2013. The company's national scale,
geographic and market size diversity as well as expected run rate
EBITDA margins of 38% (including Moody's standard adjustments)
support ratings. Cumulus is focused on debt repayment and the
required $63 million excess cash flow term loan prepayment due in
the first week of April 2013 is expected to be followed by
voluntary prepayments in the second half of this year which will
help to reduce leverage in the absence of EBITDA growth. Ratings
incorporate the cyclical nature of radio advertising demand
evidenced by the revenue declines suffered by radio broadcasters
during the past recession and by the sluggish growth witnessed
following the downturn.
Looking forward, revenue growth is expected to be flat in 2013 due
in part to the absence of significant political advertising but
expected incremental expense reductions will provide some cushion
to the extent revenues decline. Moody's expects Cumulus to
generate roughly $200 million of annual free cash flow, or 7% of
debt balances, from its well-clustered radio station portfolio
that is diversified by programming formats and audience
demographics. Despite the current inability to access the revolver
due to the 6.5x consolidated net leverage ratio test (versus a
reported 6.66x ratio as of December 31, 2012) which is measured
only if there are advances under the commitment, the company has
adequate liquidity with more than $20 million of balance sheet
cash, subtracting $63 million for the excess cash flow prepayment,
supplemented by positive annual free cash flow.
The stable outlook reflects Moody's expectations for generally
flat advertising revenue growth for the radio industry over the
next 12 months combined with challenges related to Cumulus'
ability to generate incremental EBITDA from new revenue streams.
The outlook incorporates an improvement in leverage and coverage
ratios as free cash flow is applied to reduce debt balances over
the next 12-18 months. Ratings could be downgraded if Moody's
believes the company will not be able to improve debt-to-EBITDA
ratios from current levels due to the inability to turnaround
underperforming stations, deterioration in performance as a result
of increased competition or weak ad demand in key markets, or
audience and advertising revenue migration to competing media
platforms. Further deterioration in liquidity could also result in
a downgrade. Ratings could be upgraded if leverage is sustained
under 5.25x and if liquidity is enhanced with good access to a
revolver facility in an acceptable amount or good levels of excess
cash.
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.
Headquartered in Atlanta, GA, Cumulus Media Inc. is the largest
pure-play radio broadcaster in the U.S. with approximately 517
stations (including under LMAs) in 108 markets and nationwide
radio networks serving over 5,000 affiliates. Cumulus is publicly
traded with Crestview Radio Investors, LLC owning an estimated
27.5% interest adjusted for the exercise of penny warrants. The
Dickey family owns 8.2% with Canyon Capital Advisors LLC owning
roughly 11%, and the remainder being widely held. Net revenues pro
forma for acquisitions and divestitures totaled approximately $1.1
billion for LTM December 31, 2012.
DBSI INC: Court Imposes Sanctions in Wavetronix Lawsuit
-------------------------------------------------------
Chief District Judge B. Lynn Winmill granted a motion for
sanctions filed by Conrad Myers and William Rich, defendants in
the lawsuit captioned as WAVETRONIX LLC, an Idaho limited
liability company; David Arnold; and Michael Jensen, Plaintiffs,
v. Douglas Swenson, Conrad Myers, individually but not in his
capacity as Trustee of the DBSI Liquidating Trust; John D. Foster,
Thomas Var Reeve, Charles Hassard, Paul Judge, Gary Bringhurst,
Walter Mott, Jeremy Swenson, John Mayeron, William Rich, and John
Does 1 through 20, Defendants, Case No. 4:12-cv-00244-BLW (D.
Idaho).
While the Plaintiffs voluntarily dismissed their Complaint, the
Defendants now seek sanctions against Plaintiffs David Arnold and
Michael Jensen, in addition to their attorney, Blake S. Atkin.
The case stems from the collapse of DBSI, Inc., a sprawling real
estate investment empire. DBSI was comprised of hundreds of
corporations and properties, but was controlled and successfully
ran by Defendant Douglas Swenson and his "cabal of insiders" for
many years. In 2008, during the midst of the economic downturn,
various DBSI entities filed for bankruptcy in the District of
Delaware. A plan of reorganization was confirmed in October 2010.
The reorganization plan created four trusts -- the DBSI
Liquidating Trust, the DBSI Real Estate Liquidating Trust, the
DBSI Estate Litigation Trust, and the DBSI Private Actions Trust
-- and called for the appointment of a trustee for each.
Defendant Conrad Myers was appointed as the Liquidating Trustee
for the DBSI Liquidating Trust. Defendant William Rich served as
one of Myers' professional advisors.
Immediately following confirmation of the Plan, on Nov. 5, 2010,
the Trustee of the DBSI Estate Litigation Trust and the DBSI
Private Actions Trust, James Zazzali, filed a RICO claim against
Mr. Swenson and the other officers or directors of various DBSI
Companies. Mr. Zazzali's RICO complaint is massive. It sets
forth in painstaking detail the nature of a fraudulent scheme used
to "bilk" investors, which allegedly began to infect DBSI in
approximately 2004. Mr. Zazzali's complaint alleges that DBSI
became detached from "any rational economic moorings, and
ultimately became nothing more than the instrument of the
Insiders' elaborate pyramid or 'Ponzi' scheme to defraud
Investors."
According to Messrs. Myers and Rich, Wavetronix was one of several
technology development companies that benefited from funds bilked
from DBSI's investors. From 2001 through 2006, Wavetronix
borrowed more than $21 million dollars from Stellar Technologies,
LLC, a DBSI affiliate and Idaho-based company that invested in
technology-oriented startup companies. The loans, which were
accomplished through transfers to Wavetronix from various DBSI
companies, were memorialized through promissory notes, security
agreements, and personal guarantees made out to Stellar. David
Arnold, Wavetronix's CEO, signed the notes.
The District Court's ruling notes that Wavetronix paints itself as
a victim -- rather than a beneficiary -- of DBSI's alleged fraud.
In Wavetronix's version, the DBSI Insiders set up Stellar as a
straw company to conduct their tax shelter business, and then
created bogus notes, years after the fact, to document these so-
called "loans" from Stellar to Wavetronix. Wavetronix maintains
that at first it did not know that the DBSI Insiders had created
these bogus loans; but eventually, they purportedly bullied Dr.
Arnold into signing the retroactive notes, which he was told would
never be enforced. Dr. Arnold apparently had no authority under
Wavetronix's operating agreement to execute the notes because
transactions with an affiliate required consent of the Wavetronix
board after full disclosure. Wavetronix maintains that no one --
neither borrower nor lender -- expected these notes to be repaid.
Instead, alleges Wavetronix, DBSI planned to use the invested
funds to eventually take over Wavetronix through tax fraud and the
bogus debt.
Before DBSI could leverage the notes and their investment in
Wavetronix to wrest control of the company, the economic crunch of
2007-2008 forced DBSI and its affiliate companies into bankruptcy
in early November 2008. On Oct. 26, 2010, the Bankruptcy Court
entered a Confirmation Order confirming the Plan in the Chapter 11
cases.
On May 17, 2012, Wavetronix filed the Complaint, alleging RICO
violations against the DBSI Insiders. In addition, the Complaint
included claims against Mr. Myers in his personal capacity "but
not in his capacity as Trustee of the DBSI Liquidating Trust," and
against Mr. Myers' professional advisor, William Rich. Almost a
week later, Wavetronix filed a Motion for an Order Granting
Permission to Bring a Judicial Action Against Conrad Myers as
Liquidating Trustee in his Official Capacity in the Delaware
Bankruptcy Court. This motion was ultimately denied on Aug. 2,
2012. Additionally, the Bankruptcy Court ordered Wavetronix to
withdraw with prejudice its Complaint in the District Court.
Wavetronix has appealed this decision. On Aug. 3, 2012,
Wavetronix dismissed its Complaint filed in the District Court,
without prejudice.
With regard to the Defendants' pending Motion for Sanctions, on
July 3, 2012, counsel for Defendants served Blake Atkin, counsel
for Wavetronix, a letter informing him that the filing of the
Complaint in the District Court likely violated Rule 11. The
Defendants included a draft motion for sanctions with the
accompanying letter. Wavetronix neither responded to the letter,
nor dismissed its Complaint within the 21 day "safe harbor"
provided in Rule 11.
On July 31, 2012, the Defendants filed the Motion for Sanctions.
Pursuant to Rule 11, 28 U.S.C. Sec. 1927, and the Court's inherent
powers, Defendants Myers and Rich ask the District Court to impose
sanctions against Plaintiffs David Arnold, Michael Jensen, and
their attorney Blake Atkin.
The Defendants argue that the Complaint is frivolous and wholly
lacking in both legal basis and factual foundation. As such,
Defendants assert, Rule 11 sanctions should be imposed.
A copy of the Court's March 29, 2013 Memorandum Decision and Order
is available at http://is.gd/ZzIWeWfrom Leagle.com.
About DBSI Inc.
Headquartered in Meridian, Idaho, DBSI Inc. and its affiliates
were engaged in numerous commercial real estate and non-real
estate projects and businesses. On Nov. 10, 2008, and other
subsequent dates, DBSI and 180 of its affiliates filed for
Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-12687).
DBSI estimated assets and debts between $100 million and
$500 million as of the Chapter 11 filing.
Lawyers at Young Conaway Stargatt & Taylor LLP represent the
Debtors as counsel. The Official Committee of Unsecured Creditors
tapped Greenberg Traurig, LLP, as its bankruptcy counsel.
Kurtzman Carson Consultants LLC is the Debtors' notice claims and
balloting agent.
Joshua Hochberg, a former head of the Justice Department fraud
unit, served as an Examiner and called the seller and servicer of
fractional interests in commercial real estate an "elaborate shell
game" that "consistently operated at a loss" in his report
released in October 2009. McKenna Long & Aldridge LLP was counsel
to the Examiner.
On Sept. 11, 2009, the Honorable Peter J. Walsh entered an Order
appointing James R. Zazzali as Chapter 11 trustee for the Debtors'
estates. On Oct. 26, 2010, the trustee won confirmation of the
Second Amended Joint Chapter 11 Plan of Liquidation for DBSI,
paving the way for it to pay creditors and avoid years of
expensive litigation over its complex web of affiliates. The
plan, which was declared effective Oct. 29, 2010, was co-proposed
by DBSI's unsecured creditors committee.
Pursuant to the confirmed Chapter 11 plan, the DBSI Real Estate
Liquidating Trust was established as of the effective date and
certain of the Debtors' assets, including the Debtors' ownership
interest in Florissant Market Place was transferred to the RE
Trust. Mr. Zazzali and Conrad Myers were appointed as the post-
confirmation trustees. Messrs. Zazzali and Myers are represented
by lawyers at Blank Rime LLP and Gibbons P.C.
DCB FINANCIAL: Appoints Two New Directors to Board
--------------------------------------------------
DCB Financial Corp appointed Michael Priest and Tom Mitevski as
new Class I directors effective March 21, 2013.
Mr. Priest, 49, is the President of JMAC, Inc., and the Columbus
Blue Jackets professional hockey club. In his role with the
Columbus Blue Jackets, he oversees all aspects of the franchise
operations and serves as the Alternate Governor for the club on
all National Hockey League-related matters. Mr. Priest is a
Certified Public Accountant, serves on the Executive Committee of
the Greater Columbus Sports Commission and is active in numerous
charitable activities.
Mr. Mitevski, 46, is the Executive Vice President of DGD Group,
Inc., a privately owned holding and investment company.
Previously he served as an Executive Vice President with Fifth
Third Bank from 2001 to 2011. Mr. Mitevski is a former executive
of two regional Bank Holding Companies and serves on the boards of
Big Brothers/Big Sisters Central Ohio and the American Cancer
Society.
"DCB Financial Corp shareholders will benefit tremendously from
the perspectives, diverse insights and depth of experience these
two leaders possess," said DCBF President Ronald J. Seiffert.
"They have a range of expertise in leading large, complex
organizations that will enhance the board of directors. We look
forward to the contributions each of them will make."
About DCB Financial
DCB Financial Corp. is a financial holding company headquartered
in Lewis Center, Ohio. The Corporation has one wholly-owned
subsidiary bank, The Delaware County Bank and Trust Company (the
"Bank"). The Corporation also has two additional wholly owned
subsidiaries, DCB Title and DCB Insurance Services LLC. DCB Title
provides standard real estate title services, while DCB Insurance
Services LLC provides a variety of insurance products. However,
neither nonbank subsidiary is material to the financial results of
the Corporation. The Bank has one wholly-owned subsidiary, ORECO,
which is used to process other real estate owned.
The Corporation was incorporated under the laws of the State of
Ohio in 1997, as a financial holding company under the Bank
Holding Company Act of 1956, as amended, by acquiring all
outstanding shares of the Bank. The Corporation acquired all such
shares of the Bank after an interim bank merger, consummated on
March 14, 1997. The Bank is a commercial bank, chartered under
the laws of the State of Ohio, and was organized in 1950.
The Bank provides customary retail and commercial banking services
to its customers, including checking and savings accounts, time
deposits, IRAs, safe deposit facilities, personal loans,
commercial loans, real estate mortgage loans, installment loans,
trust and other wealth management services. The Bank also
provides cash management, bond registrar and paying agent services
for commercial and public unit entities. Through its subsidiary
Datatasx, the Bank provided data processing and other bank
operational services to other financial institutions. Those
services were discontinued in September 2011, and were not a
significant part of operations or revenue.
In October 2010, the Corporation's wholly-owned bank subsidiary
entered into a Consent Agreement with the FDIC which requires that
Tier-1 and Total Risk Based Capital percentages reach 9.0% and
13.0% respectively. As of March 31, 2012, the Bank's capital
ratios, as previously noted, were not at these levels.
The Corporation and its subsidiaries meet all published regulatory
capital requirements. The ratio of total capital to risk-weighted
assets was 10.3% at March 31, 2012, while the Tier 1 risk-based
capital ratio was 6.7%.
As reported in the TCR on April 5, 2012, Plante & Moran PLLC, in
Columbus, Ohio, said DCB's bank subsidiary is not in compliance
with revised minimum regulatory capital requirements under a
formal regulatory agreement with the banking regulators. "Failure
to comply with the regulatory agreement may result in additional
regulatory enforcement actions."
The Company's balance sheet at Dec. 31, 2012, showed $506.49
million in total assets, $458.10 million in total liabilities and
$48.39 million in total stockholders' equity.
DELTA-ADDISON LLC: Case Summary & 3 Unsecured Creditors
-------------------------------------------------------
Debtor: Delta-Addison LLC
2442 North Lincoln Avenue, 2nd Floor
Chicago, IL 60614
Bankruptcy Case No.: 13-11904
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Pamela S. Hollis
Debtor's Counsel: O. Allan Fridman, Esq.
LAW OFFICE OF O. ALLAN FRIDMAN
555 Skokie Boulevard, Suite 500
Northbrook, IL 60062
Tel: (847) 412-0788
Fax: (847) 412-0898
E-mail: afridman@tds.net
Scheduled Assets: $1,030,000
Scheduled Liabilities: $1,019,000
A copy of the Company's list of its three largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/ilnb13-11904.pdf
The petition was signed by Mark Weiss, manager member.
DIMENSIONS HEALTH: Fitch Affirms 'CC' Rating $56.6MM Revenue Bonds
------------------------------------------------------------------
Fitch Ratings affirms the 'CC' rating on the approximately
$56.6 million Prince George's County, MD project and refunding
revenue bonds series 1994 issued on behalf of Dimensions Health
Corporation. DHC is the operator of three county-owned facilities
known as Dimensions Health System.
SECURITY
Debt payments are secured by a pledge of the gross revenues of the
obligated group and a fully funded debt service fund.
KEY RATING DRIVERS
HEIGHTENED RISK UNTIL LONG-TERM PLAN IMPLEMENTED: DHS' financial
performance continues to be dependent on annual appropriations
from the county and state. The need to secure a long-term
solution, which requires finding sufficient sources of funding for
its significant capital needs, is essential for DHS' long-term
viability.
TRANSFORMATION OF DHS: The implementation of the memorandum of
understanding (MOU) between DHS, the state of Maryland (the
state), Prince George's County (the county), the University of
Maryland Medical System (UMMS; rated 'A', Stable Outlook) and the
University System of Maryland (USM; rated 'AA+', Stable Outlook),
with the goal of reorganizing DHS, continues to be on track. A
certificate of need (CON) for a new facility is expected to be
submitted in the fall of 2013. So far, two thirds of the necessary
funding has been committed to by the state and the county, subject
to appropriations. The remaining funding will come in the form of
reimbursement rate relief from the Maryland Health Services Cost
Review Commission.
NO FINANCIAL FLEXIBILITY: DHS' financial profile continues to be
precarious, as reflected in the going concern language in its
audits since 2005. DHS is reliant on county and state funds to
support its operations. The county and state have pledged to
continue to provide $30 million of annual financial assistance in
the form of grants, subject to appropriations, until 2015, by
which time it is expected that a permanent plan for the
transformation of DHS will be in place.
IMPLEMENTATION OF OPERATIONAL IMPROVEMENTS: Management is focused
toward streamlining system operations in order to reduce operating
losses and increase revenues and has targeted $7 million of
additional revenues and $5 million of expense reductions to be
accomplished over the next 18 months.
RATING SENSITIVITIES
UNLIKELY RATING MOVEMENT UNTIL LONG TERM PLAN FINALIZED: Although
the partnership to transform DHS is viewed favorably, it is
unlikely that a rating change will occur until a definitive plan
to address DHS' financial and capital needs has been finalized and
the sources of payment for implementation have been secured.
CREDIT PROFILE
The affirmation of the 'CC' rating reflects DHS' stressed
financial situation which requires the ongoing financial support
of the state and the county (both rated 'AAA' with a Stable
Outlook by Fitch) in order to meet its financial and bond payment
obligations.
Reflecting the essentiality of DHS' role as the safety net
provider, both the state and the county have provided grant
support to DHS of $15 million each for fiscal 2013 and it is
expected that this level of support will be maintained until 2015,
subject to appropriation approval, in order to enable DHS to
continue to meet its operating needs, albeit at minimal levels,
and debt service payments. The state has also appropriated an
additional $24 million for DHS' capital needs over the 2013-2015
period, the bulk of which will be spent on renovations to the
Laurel and Bowie campuses.
Fitch views as positive the July 21, 2011 announcement of a
partnership between DHS, the state and the county and UMMS for
developing a comprehensive plan to provide for health care needs
of county residents, which is intended to address the long-
standing financial and capital needs of DHS. One of the
articulated goals of the partnership is the plan to build a new
regional medical center and health sciences campus to be located
in central Prince George's County, which would augment and/or
replace some of DHS' existing facilities. However, this solution
will require the sharing of the cost by the state, county and
assistance in the form of rate relief from the HSCRC.
UMMS has already completed an initial study of the health care
needs of the county's population, which indicated the need for a
new facility and for an additional 61 primary care physicians. The
cost of the new facility, now downsized to 259 inpatient beds and
19 observations beds, is estimated at approximately $645 million,
which includes construction costs, cost of land acquisition and
working capital. Several potential sites have been identified, one
of which is already county owned and a final decision will be made
in May. The ultimate plan will also need to address approximately
$100 million of DHS' unfunded pension, outstanding debt and
unfunded retiree benefits before 2017, and will also require a
transfer of the ownership of DHS' assets from the county to the
new entity. The next phase of the plan, presently underway, is
firming up the funding sources for the new regional facility. The
state and the county have already committed to each contribute
approximately $200 million to the project, with the State
contribution expected to be appropriated in stages over the next
five years. The remaining funding will come in the form of
reimbursement rate relief from the HSCRC. The current timetable
envisions a CON to be submitted by the fall of 2013.
DHS' Prince George's Hospital Center serves as one of two safety
net hospitals in the county, which together with other system
inpatient and outpatient facilities provide for the essential
health care needs of the underinsured and indigent population of
the service area. The system has a history of extremely weak
financial performance with liquidity and operating metrics
consistently at or below Fitch's investment grade medians, when
excluding the impact of the grant support. DHS' audited financial
statements have been receiving 'going concern' opinions since
2005.
DHS continues to implement a financial improvement plan and
management targeted $7 million of additional revenues and $5
million of expense reductions to be accomplished over the next 18
months. As planned, 61 beds of the Gladys Spellman Specialty
Hospital and Nursing Center (Gladys Spellman) long term care
facility were sold in October 2012 for $467,500 to a for-profit
operator (Genesis Healthcare). The remaining 46 chronic care beds
were transferred to Laurel Hospital and management reports
positive results from the improved reimbursement base. The
proceeds of the sale will be used to repurpose the Gladys Spellman
facility for family services, physician offices and various other
outpatient uses.
DHS ended fiscal year 2012 (year end June 30) with a positive
operating income of $11.9 million, equal to an operating margin of
3.3% and operating EBITDA margin of 6.9%. Fitch includes grant
funds, which were $31.3 million in 2012, in operating income.
Excluding the grant revenues, DHS would have reported an operating
loss of $19.4 million. For the six-month interim period ended
Dec. 31, 2012, DHS reported operating income of $1.5 million
(includes pro rata share of 2013 grant revenues of $15 million),
for operating margin of 0.8% and operating EBITDA margin of 4.3%.
Excluding the grant revenues, the interim period ended with
operating loss of $12.6 million, ahead of the budgeted loss of
$15.5 million.
Coverage of maximum annual debt service (MADS) by EBITDA was solid
at 3.6 times (x) in fiscal 2012 and was 2.3x through the interim
period. DHS' debt burden is manageable with MADS representing a
moderate 2.1% of revenues. Liquidity, despite improving slightly
over time, continues to be extremely weak; days cash on hand
(DCOH) were at 39 days at fiscal 2012 year-end and were reported
at 40.1 days for the interim period. Unrestricted cash to debt was
66.9% at Dec. 31, 2012.
Dimensions Health System had $357 million in total revenues for
fiscal 2012. The system posts annual and interim financial
statements on the 'www.dimensionshealth.com' website, which does
not provide management analysis and commentary, but management
analysis and commentary is provided to bondholders.
DREIER LLP: Investor Coughs Up $3.5 Million
-------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Patriot Group LLC, an investment adviser for a pair
of funds, thought it escaped unscathed from the fraud perpetrated
by admitted Ponzi schemer Marc Dreier. To avoid the possibility
of a judgment for $16.7 million plus interest, Patriot agreed to
pay $3.5 million to the trustee for the law firm Mr. Dreier
headed.
The report recounts Mr. Dreier sold notes to investors purportedly
on behalf of a prominent real estate owner in New York. Instead,
Mr. Drier was running a Ponzi scheme where new investors' money
was used to pay high rates of interest and return of principal to
prior investors.
The report relates that on behalf of two funds, Patriot bought $15
million in notes and recovered $16.65 million before the fraud
surface and Mr. Dreier and his firm ended up in bankruptcy. The
trustee for the firm sued, seeking to recover the repaid
principal, fictitious interest, and interest.
Patriot decided to settle by paying $3.5 million. The settlement
comes up for approval on April 30 in U.S. Bankruptcy Court in New
York.
Shiela M. Gowan, trustee for the Drier firm, said she was
confident of recovering the $1.65 million in fictitious interest.
She admitted that success on the claim to recover principal would
have been more difficult.
About Marc Dreier and Dreier LLP
Marc Dreier founded New York-based law firm Dreier LLP --
http://www.dreierllp.com/-- in 1996. On Dec. 8, 2008, the U.S.
Securities and Exchange Commission filed a suit, alleging that Mr.
Dreier made fraudulent offers and sales of securities in several
cities, selling fake promissory notes to hedge and other private
investment funds. The SEC asserted that Mr. Dreier also
distributed phony financial statements and audit opinions, and
recruited accomplices in connection with that scheme. Mr. Dreier,
currently in prison, was charged by the U.S. government for
conspiracy, securities fraud and wire fraud (S.D.N.Y. Case No.
09-cr-00085).
Dreier LLP sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
08-15051) on Dec. 16, 2008. Stephen J. Shimshak, Esq., at Paul,
Weiss, Rifkind, Wharton & Garrison LLP, was tapped as counsel.
The Debtor estimated assets of $100 million to $500 million, and
debts between $10 million and $50 million in its Chapter 11
petition.
Sheila M. Gowan, a partner with Diamond McCarthy, was appointed
Chapter 11 trustee for the Dreier law firm. Ms. Gowan is
represented by Jason Porter, Esq., at Diamond McCarthy LLP.
Wachovia Bank National Association, the Dreier LLP Chapter 11
trustee, and Steven J. Reisman as post-confirmation representative
of the bankruptcy estate of 360networks (USA) Inc. signed a
petition that put Mr. Dreier into bankruptcy under Chapter 7 on
Jan. 26, 2009 (Bankr. S.D.N.Y. Case No. 09-10371). Mr. Dreier,
60, pleaded guilty to fraud and other charges in May 2009. The
scheme to sell $700 million in fake notes unraveled in late 2008.
Mr. Dreier is serving a 20-year sentence in a federal prison in
Minneapolis.
DUMA ENERGY: Incurs $481,700 Net Loss in Jan. 31 Quarter
--------------------------------------------------------
Duma Energy Corp. filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $481,782 on $1.68 million of revenue for the three months ended
Jan. 31, 2013, as compared with a net loss of $291,877 on $1.83
million of revenue for the same period during the prior year.
For the six months ended Jan. 31, 2013, the Company incurred a net
loss of $38.35 million on $3.71 million of revenue, as compared
with a net loss of $4.49 million on $3.40 million of revenue for
the same period a year ago.
The Company's balance sheet at Jan. 31, 2013, showed $26.06
million in total assets, $15.15 million in total liabilities and
$10.90 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/cbFilw
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.
ENERGYSOLUTIONS INC: Hearing on Derivative Suit Deal on April 15
----------------------------------------------------------------
The shareholder derivative action between Jack Fish, Derivatively
on Behalf of Nominal Defendant EnergySolutions, Inc., as
plaintiff, vs. Lindsay Goldberg & Bessemer, L.P., ENV Holdings,
LLC, Alan E. Goldberg, Robert D. Lindsay, Robert J.S. Roriston,
Lance L. Hirt, and Andrew S. Weinberg, as defendtans, is being
settled.
A hearing will be held on April 15, 2013, at 2:15 p.m., before the
Supreme Court of the State of New York, County of New York, 60
Centre Street, New York, New York 10007, before the Honorable
Justice Kornreich, to determine: (i) whether the terms of the
Settlement should be approved as fair, reasonable and adequate;
(ii) whether to award Plaintiff's Counsel fees and expenses in the
amount of $1,650,000; and (iii) whether the Action should be
dismissed with prejudice against the Defendants as set forth in
the Stipulation filed with the Court.
The Action was brought derivatively on behalf of EnergySolutions
against certain former officers and directors of the Company for
allegedly violating their fiduciary duties by selling shares of
EnergySolutions common stock in the Company's June 2008 stock
offering with the benefit of material non-public information and
against the Company's former majority stockholder and an affiliate
for allegedly aiding and abetting the alleged violation of
fiduciary duties.
In 2005, the Individual Defendants, their affiliates, and other
investors formed ENV Holdings, which acquired the predecessor to
EnergySolutions and various other waste disposal companies for the
purpose of creating a vertically integrated nuclear radioactive
waste disposal company. At all relevant times the Individual
Defendants and their affiliates, including Lindsay Goldberg, owned
and controlled ENV Holdings and served as, among other things,
principals of ENV Holdings, members of ENV Holdings' Board of
Managers, and directors of EnergySolutions.
On July 24, 2008, the Company conducted the July 2008 Offering.
Through the July 2008 Offering, ENV Holdings sold approximately
73% of its then-current holdings of EnergySolutions common stock.
The July 2008 Offering was conducted pursuant to the July 2008
Registration Statement, which discussed the Company's purported
business relationships, as well as its purported potential for
business growth and purported investment opportunities.
On October 14, 2008, the Company issued a press release announcing
that: (1) the trust fund for the Company's "Zion Project" had
significantly decreased in value, and that the Company would not
be further pursuing the project at that time; (2) the Nuclear
Regulatory Commission had denied the Company's petition to amend
the rule against releasing decommissioning trust funds for use in
operating facilities; and (3) the revenues and earnings estimates
the Company had previously provided in the July 2008 Registration
Statement would be significantly reduced.
In the Action Plaintiff alleges, among other things, that the
Individual Defendants, through ENV Holdings and Lindsay Goldberg,
sold EnergySolutions stock in the July 2008 Offering based on
material non-public information regarding the true but undisclosed
nature of the Company's existing business relationships and
business opportunities.
On Dec. 9, 2011, the Parties held a mediation session with the
Honorable Layn R. Phillips (Ret.) ("Judge Phillips") in an attempt
to resolve the Action and the Class Action. The Parties did not
reach a resolution at that time.
Beginning on July 19, 2012, Plaintiff's counsel received the first
of a series of rolling document productions. Plaintiff received
documents on July 19, 2012, Aug. 9, 2012, Sept. 4, 2012, and
Sept. 11, 2012.
On Sept. 7, 2012, the Parties held another mediation session with
Judge Phillips in a further attempt to resolve the Action and the
Class Action. The Parties did not reach a resolution at that
time.
On or around Oct. 11, 2012, as a result of subsequent negotiations
conducted through Judge Phillips, the parties to the Action and
Class Action reached an agreement to settle the actions.
The terms of the Settlement set forth in the Stipulation provide
for payment by the Company's directors' and officers' liability
insurers to the Company the sum of $6,500,000, as instructed in
writing by the Company, which amount the Company may direct to be
contributed to the settlement of the Class Action. In exchange
therefor, Plaintiff, derivatively on behalf of EnergySolutions,
will completely discharge, dismiss with prejudice on the merits,
settle and release the Released Claims as to all Released Persons,
and all such Released Claims will be barred by injunction.
Plaintiff will also release all claims against Defendants' counsel
related to the defense of the Action. The Defendants and their
Related Persons will also release any claims they may have against
Plaintiff and Plaintiff's counsel related to their bringing and
prosecuting the Action.
The Defendants have denied and continue to deny each and all of
the claims and contentions alleged by the Plaintiff in the Action
and all charges of wrongdoing or liability against them.
A complete copy of the Notice is available for free at:
http://is.gd/9w03aA
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.
EnergySolutions reported net income of $3.92 million in 2012, as
compared with a net loss of $193.64 million in 2011. 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," the Company said in its annual
report for the year ended Dec. 31, 2012.
* * *
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.
ENTRAVISION COMMUNICATIONS: S&P Raises Corp. Credit Rating to 'B+'
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Santa Monica, Calif.-based Spanish-language media
company Entravision Communications Corp. to 'B+' from 'B'. The
outlook is stable.
S&P also raised the issue-level rating on Entravision
Communication Corp.'s senior secured notes to 'B+' (the same level
as the corporate credit rating) from 'B'. The recovery rating on
this debt remains '3', indicating S&P's expectation for meaningful
(50% to 70%) recovery for noteholders in the event of a payment
default.
The upgrade reflects S&P's expectation that the company will
maintain its lease-adjusted debt to trailing-eight-quarter average
EBITDA below 6x through elections cycles while maintaining at
least a 20% EBITDA margin of compliance under its financial
covenants.
"We expect leverage will remain below our target for the rating
partially because of increasing retransmission revenues despite
exposure to structural trends in radio," said Standard & Poor's
credit analyst Chris Valentine.
S&P continues to view Entravision's financial risk profile as
"highly leveraged" based on its high debt-to-EBITDA ratio,
although S&P believes the company will maintain "adequate"
liquidity over the intermediate term, supplemented by healthy cash
balances. Factors supporting S&P's assessment of Entravision's
business risk profile as "fair" include the company's exclusive
long-term TV affiliation agreements with Univision Communications
Inc., its low programming costs, favorable Hispanic demographic
trends, and its diversified portfolio of TV and radio station
assets, which have healthy audience ratings in top Hispanic
markets.
Entravision is a diversified Spanish-language TV (70% of 2012
revenue) and radio (30%) broadcaster. The company owns and
operates 56 primary television stations and 49 Spanish language
radio stations. It is the largest TV station affiliate of
Univision Communications Inc., which in S&P's opinion has
benefited the company's audience ratings, programming costs, and
retransmission consent revenues.
As a result of its affiliation agreements, Entravision has
incurred limited costs of network and syndicated programming on
its Univision- and UniMas-affiliated stations, but it faces
competition from English-language broadcasters entering Hispanic
broadcasting. Despite secular pressures in the radio business,
S&P believes Hispanic radio broadcasters are slightly more
insulated from online advertising competition than English
language peers over the longer term because of favorable
population trends and lower broadband penetration among this
demographic. Still, S&P sees evidence of Hispanic radio loosing
share to online media and expect sub-GDP growth in radio ad
spending over the intermediate term. Overall, advertising pricing
for Spanish-language media is not commensurate with its audience
share compared with English-language media, and S&P do not expect
this gap to meaningfully narrow over the intermediate term.
EUROFRESH INC: Creditors' Panel Negotiates Sale Price Up
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Eurofresh Inc. unsecured creditors' committee
didn't succeed in winning a recovery by unsecured creditors,
although the panel did persuade the buyer to cover claims entitled
to full payment in Chapter 11 reorganization.
The report recounts that Eurofresh attracted no bids to better the
offer from competing tomato grower NatureSweet Ltd. to buy the
business in exchange for about $51.2 million in secured debt
acquired two days before bankruptcy. The committee objected to
the sale, contending bankruptcy isn't a federal foreclosure law
and can't be used when expenses of the Chapter 11 case are left
unpaid.
According to the report, the committee negotiated a settlement
where NatureSweet will pay an additional $1.4 million to ensure
full payment of claims from suppliers who shipped goods 20 days
before bankruptcy. Under bankruptcy law, those claims are
entitled to full payment.
Paul Kizel, an attorney for the committee, said in an interview
that NatureSweet will supply $700,000 on top of financing for the
Chapter 11 case to cover costs of running the bankruptcy. Mr.
Kizel is from Lowenstein Sandler PC in Roseland, New Jersey.
The bankruptcy judge in Tucson, Arizona, formally approved the
sale to NatureSweet on March 28.
About EuroFresh Inc.
EuroFresh , Inc., is America's largest greenhouse grower spanning
318 aces of glass covered facilities. EuroFresh grows premium
quality, great tasting, certified pesticide residue free
greenhouse tomatoes and cucumbers year-round. The 274-acre
flagship facility in Willcox, Arizona, is the world's largest.
There's also a second 44-acre acre property in Snowflake, Arizona.
EuroFresh has 964 employees.
EuroFresh filed a Chapter 11 petition (Bankr. D. Ariz. Case No.
13-01125) on Jan. 27, 2013, to complete a sale of the business to
NatureSweet Limited, absent higher and better offers.
NatureSweet and EuroFresh Farms are two of the leading producers
of high-quality tomatoes in North America.
EuroFresh first filed for Chapter 11 protection (Bankr. D. Ariz.
Lead Case No. 09-07970) on April 21, 2009. Eurofresh exited
bankruptcy in November 2009 following a deal with majority of
their existing debt holders to convert more than $200 million of
debt into equity.
In the new Chapter 11 case, Frederick J. Petersen, Esq., and Isaac
D. Rothschild, Esq., at Mesch, Clark & Rothschild, P.C., serve as
counsel to the Debtors.
The Official Committee of Unsecured Creditors appointed in the
case has retained Lowenstein Sandler LLP; and Jennings, Strouss &
Salmon, P.L.C., as bankruptcy counsel.
FLOORING AMERICA: Ga. App. Ct. Rules in Suntrust-Related Disputes
-----------------------------------------------------------------
Before the Court of Appeals of Georgia are consolidated appeals
arising from an action filed in Fulton County Superior Court by
Morton P. Levine, the Chapter 11 Bankruptcy Trustee for the estate
of Flooring America, Inc., (f/k/a The Maxim Group, Inc.), against
Suntrust Robinson Humphrey (f/k/a The Robinson-Humphrey Co., LLC),
alleging damages to the estate of Maxim as a result of Suntrust's
professional negligence; breach of contract; negligent
misrepresentation; fraud; aiding and abetting fraud on the part of
culpable Maxim board members; breach of fiduciary duty; aiding and
abetting CEO A. J. Nasser's breach of fiduciary duty; and civil
conspiracy in concert with Nasser, other board members, and other
fiduciary defendants in relation to Suntrust's role as financial
advisor to Maxim in connection with (1) a 1998 purchase of 266
retail stores from Shaw Industries ("the Shaw Transaction"); and
(2) a 1999 sale of Maxim's manufacturing subsidiary ("the Image
Transaction").
The appeals are styled as LEVINE, v. SUNTRUST ROBINSON HUMPHREY;
LEVINE, v. SUNTRUST ROBINSON HUMPHREY; SUNTRUST ROBINSON HUMPHREY
v. LEVINE; and SUNTRUST ROBINSON HUMPHREY v. LEVINE, Case Nos.
A12A1768, A12A1880, A12A1881, A12A1882.
At the time of the Shaw and Image Transactions, Maxim was a
company in the floor covering industry. Suntrust was engaged as
financial advisor to Maxim. In June 2000, Maxim filed for Chapter
11 bankruptcy protection. Mr. Levine was appointed as trustee to
oversee the estate. By 2002, the Trustee filed proceedings
against various parties alleged to have caused and/or contributed
to the destruction of Maxim's business. The trial court appointed
a Special Master to oversee the case, and all defendants except
Suntrust settled with the Trustee.
In Case Number A12A1768, Maxim appealed from the trial court's
order adopting the Special Master's report. On review, the
Appeals Court (1) finds that the trial court erred in granting
partial summary judgment with respect to the damage claims based
on the Special Master's erroneous conclusion that Maxim was
required to show the exact amount of damages resulting from
Suntrust's breach; (2) the trial court erred on granting summary
judgment on Maxim's fraud claims for lack of evidence of scienter;
and (3) the trial court erred by excluding the expert testimonies
of Harry Potter and Alfred King.
In Case Number A12A1881, Suntrust cross-appealed the trial court
order on some summary judgment motions. On review, the Appeals
Court (1) disagrees that the trial court erred in excluding the
expert testimony of James Harris; and (2) disagrees that the trial
court erred in denying partial summary judgment as to the
remaining negligence claims, as to the negligent misrepresentation
claim, as to the breach of fiduciary duty claim, as to the breach
of contract claim, and on the basis of the in pari delicto
doctrine.
In Case Number A12A1882, Suntrust appealed the trial court order
involving some engagement letters. On review, the Appeals Court
finds no error in the trial court granting partial summary
judgment to Maxim with regard to certain clauses within the
parties' engagement letters.
Maxim's duplicate appeal docketed as Case No. A12A1880 is
dismissed as moot, the Appeals Court ruled.
A copy of the Georgia Court of Appeals' March 22, 2013 order is
available at http://is.gd/jwgtFsfrom Leagle.com.
FNB UNITED: To Issue 600,000 Shares Under 2012 Incentive Plan
-------------------------------------------------------------
FNB United Corp. filed with the U.S. Securities and Exchange
Commission a Form S-8 registration statement to register 600,000
shares of common stock issuable under the Company's 2012 Incentive
Plan for a proposed maximum aggregate offering price of
$5.8 million. A copy of the prospectus is available for free at:
http://is.gd/nSRboh
About FNB United
Asheboro, N.C.-based FNB United Corp. (Nasdaq:FNBN) is the bank
holding company for CommunityOne Bank, N.A., and the bank's
subsidiary, Dover Mortgage Company. Opened in 1907, CommunityOne
Bank -- http://www.MyYesBank.com/-- operates 45 offices in 38
communities throughout central, southern and western North
Carolina. Through these subsidiaries, FNB United offers a
complete line of consumer, mortgage and business banking services,
including loan, deposit, cash management, wealth management and
internet banking services.
FNB United incurred a net loss of $40 million in 2012, a net loss
of $137.31 in 2011, and a net loss of $131.82 million in 2010.
The Company's balance sheet at Dec. 31, 2012, showed $2.15 billion
in total assets, $2.05 billion in total liabilities and $98.44
million in total shareholders' equity.
FREDERICK'S OF HOLLYWOOD: Harbinger Holds 77% Stake at March 15
---------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Five Island Asset Management LLC, Harbinger Group Inc.
and Philip A. Falcone disclosed that, as of March 15, 2013, they
beneficially own 77,451,109 shares of common stock of Frederick's
of Hollywood Group Inc. representing 77.8% of the shares
outstanding. A copy of the regulatory filing is available at:
http://is.gd/ootSYv
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. 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.
G+G RETAIL: BCBG's Summary Judgment Bid Denied in Employee Suit
---------------------------------------------------------------
Puerto Rico District Judge Garcia-Gregory denied a motion for
summary judgment filed by BCBG Max Azria Group, Inc., in an age
discrimination and unlawful employment discharge claim originally
brought in state court by Virginia Delgado-Rodriguez and her
daughter Tiffany Gomez-Delgado. The Plaintiffs sued against BCBG
Max Azria Group, seeking redress under Puerto Rico Law Nos. 80 of
May 30, 1976, as amended, and 100 of October 30, 1959, as amended.
Ms. Delgado was initially employed by G+G Retail Inc., which was
later acquired in bankruptcy by Max Rave, a wholly owned
subsidiary of BCBG Max Azria Group. In 2011, all Max Rave stores
closed and all its employees were laid off. Ms. Delgado's
termination became effective Jan. 27, 2011.
BCBG removed the action to the District Court and quickly moved
for summary judgment on the sole ground that it was not the
Plaintiffs' employer as defined by Laws 80 and 100. BCBG argues
that it cannot be held liable to the Plaintiffs and that summary
judgment should be granted in its favor.
On Jan. 2006, G+G Retail, Inc., filed for Chapter 11 relief under
the Bankruptcy Code. As part of that proceeding, G+G auctioned
off its assets, including the "RAVE" stores it owned. Max Rave
was the winning bidder, and subsequently acquired G+G's assets
through an Asset Purchase Agreement.
The lawsuit is, DELGADO-RODRIGUEZ, Plaintiff, v. BCBG MAX AZRIA
GROUP, INC., Defendant, Civil No. 12-1085 (D. P.R.). A copy of
the Court's March 27, 2013 Opinion and Order is available at
http://is.gd/Cxjez1from Leagle.com.
Headquartered in New York, New York, G+G Retail Inc. retails
ladies wear and operates 566 stores in the United States and
Puerto Rico under the names Rave, Rave Girl and G+G. The Debtor
filed for Chapter 11 protection on Jan. 25, 2006 (Bankr.
S.D.N.Y. Case No. 06-10152). William P. Weintraub, Esq., Laura
Davis Jones, Esq., David M. Bertenthal, Esq., and Curtis A.
Hehn, Esq., at Pachulski, Stang, Ziehl, Young & Jones P.C.
represent the Debtor in its restructuring efforts. Scott L.
Hazan, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.,
represents the Official Committee of Unsecured Creditors. When
the Debtor filed for protection from its creditors, it estimated
assets of more than US$100 million and debts between US$10 million
to US$50 million. The Court confirmed the Debtor's Plan of
Liquidation on Dec. 6, 2006.
GEOKINETICS INC: Annual Report Filed
------------------------------------
BankruptcyData reported that Geokinetics filed with the SEC its
Annual Report for the year ending December 31, 2012.
According to the report, revenues and operating cash flows
decreased during 2012 compared to 2011. The Company, the report
added, continued to incur operating losses primarily due to delays
in project commencements and low international asset utilization,
leading to a reduction of available liquidity. In response,
Geokinetics states that it evaluated "strategic alternatives and
initiated actions designed to improve [its] liquidity position by
giving priority to generating cash flows while maintaining [its]
long-term commitment to providing high quality seismic data
acquisition services," the report cited.
Consolidated revenues for the year ended December 31, 2012 totaled
$596 million compared to $764 million for the same period in 2011,
a decrease of $168 million, the report said. The decrease in
revenues was primarily attributable to decreased activity in North
America, Africa and Asia Pacific, offset by increased activity in
Latin America. Consolidated Adjusted EBITDA totaled $106 million
in 2012, compared to $85 million in 2011. The increase was
primarily the result of increased activity and productivity in
Latin America. 2012's net loss was $83 million -- compared to $222
million in 2011.
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.
GMX RESOURCES: Files for Chapter 11 to Sell Biz to Lenders
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that GMX Resources Inc., an Oklahoma City-based oil and
gas exploration and production company, filed a Chapter 11
petition in its hometown (Bankr. W.D. Okla. Case No. 13-bk-11456)
on April 1 so secured lenders can buy the business in exchange for
$324.3 million in first-lien notes.
The report relates that according to a court filing, bankruptcy
resulted from the "substantial drop in and sustained low natural
gas prices" and "excess production."
GMX missed a payment due last month on $51.5 million in second-
lien notes. Other principal liabilities include $48.3 million in
unsecured convertible senior notes.
The company disclosed in its petition assets with a value of
$281.1 million and liabilities totaling $458.5 million.
A group of senior noteholders agreed to provide financing for the
Chapter 11 effort. They are requiring GMX to file papers within 20
days setting up auction and sale procedures. There must be court
approval of a sale within 75 days after approval of sale
procedures.
The lenders and principal senior noteholders include Chatham Asset
Management LLC, GSO Capital Partners, Omega Advisors Inc. and
Whitebox Advisors LLC.
The $288.6 million in first-lien notes due 2017 last traded on
March 20 for 81 cents on the dollar, according to Trace, the bond-
price reporting system of the Financial Industry Regulatory
Authority. The second-lien notes traded at 11:39 a.m. April 1 for
22 cents on the dollar, Trace reported. The $48.3 million in
senior unsecured notes due 2015 last traded on March 28 for
33 cents on the dollar, according to Trace.
About GMX Resources
GMX Resources Inc. -- http://www.gmxresources.com/-- is an
independent natural gas production company headquartered in
Oklahoma City, Oklahoma. GMXR has 53 producing wells in Texas &
Louisiana, 24 proved developed non-producing reservoirs, 48 proved
undeveloped locations and several hundred other development
locations. GMXR has 9,000 net acres on the Sabine Uplift of East
Texas. GMXR has 7 producing wells in New Mexico. The Company's
strategy is to significantly increase production, revenues and
reinvest in increasing production. GMXR's goal is to grow and
build shareholder value every day.
The Company reported net losses of $206.44 million in 2011,
$138.29 million in 2010, and $181.08 million in 2009.
The Company's balances sheet at Sept. 30, 2012, showed $343.14
million in total assets, $467.64 million in total liabilities and
a $124.49 million total deficit.
GREGORY & PARKER: Has Green Light to Employ Janvier Law Firm
------------------------------------------------------------
Bankruptcy Judge Stephani W. Humrickhouse granted the application
of Gregory & Parker, Inc., to employ William P. Janvier and
Janvier Law Firm, PLLC, as counsel in its adversary proceeding
against Conan R. McClain.
Gregory & Parker owns Seaboard Station, a retail center near
William Peace University at the northern fringe of downtown
Raleigh, North Carolina. Gregory & Parker filed a Chapter 11
petition Feb. 22, 2012 (Bankr. E.D. N.C. Case No. 12-01382).
Richard D. Sparkman, Esq., at Richard D. Sparkman & Assoc., P.A.,
represents the Debtor. The Debtor estimated assets of between
$100,000 and $500,000, and debts of between $10 million and
$50 million.
The debtor is the sole member of Gregory & Parker-Seaboard, LLC,
which filed a chapter 11 petition on the same day as debtor.
William Douglas Parker, Jr. owns 100% of the debtor's outstanding
shares and Diana Lynne Parker is the corporate secretary. The
debtor filed its chapter 11 petition (Bankr. E.D.N.C. Case No.
12-01382) on Feb. 22, 2012, with Richard D. Sparkman and Richard
D. Sparkman & Associates, P.A. serving as counsel.
On April 25, 2012, William Douglas Parker, Jr. and his wife, Diana
Lynne Parker, filed a chapter 11 petition, with William P. Janvier
and Janvier Law Firm, PLLC serving as counsel.
The debtor and the Parkers have certain creditors in common,
including Conan R. McClain, who has provided professional services
related to redevelopment, financing, marketing, leasing and
management of debtor's commercial properties since November 2004.
Mr. McClain originally provided services to debtor in his capacity
as a vice president of Trammell Crow Services, Inc., until
December 2005, at which time he resigned from Trammel Crow, but
continued performing services for debtor in his individual
capacity. Mr. McClain has filed two claims in both the debtor's
case and in the Parkers' case, with the claims totaling
$1,844,253.14 in each case.
Mr. Janvier has explained that the debtor and the Parkers
anticipated joining as plaintiffs to file an adversary proceeding
against Mr. McClain, alleging certain misconduct of Mr. McClain.
Mr. Janvier has not previously represented the debtor, but
contends that because of his extensive knowledge of the relevant
facts, joint representation of the debtor and the Parkers in the
adversary proceeding would be most economical, and based on the
specific, limited scope of engagement, does not create a conflict
of interest.
Mr. McClain objects to joint representation, alleging that certain
conflicts of interest exist between the debtor and the Parkers
that prohibit Mr. Janvier from representing both in the adversary
proceeding. At the request of the court, counsel for the
bankruptcy administrator provided his opinion on the issue after a
hearing and, citing the potential conflicts alleged by Mr.
McClain, objected to employment of Mr. Janvier as counsel in the
adversary proceeding.
In a March 28, 2013 Order is available at http://is.gd/azIwuXfrom
Leagle.com, Judge Humrickhouse said that notwithstanding Mr.
Janvier's representation of the Parkers as general counsel in
their bankruptcy case, the court finds that Mr. Janvier is a
"disinterested" person and does not represent any interest adverse
to the estate with respect to the adversary proceeding.
The debtor's application also sought Court approval for the
employment of K. Matthew Vaughn and Stevens Martin Vaughn and
Tadych, PLLC as counsel for the same adversary proceeding. No one
objected to employment of Mr. Vaughn, and the court issued an
order on March 4, 2013, allowing K. Matthew Vaughn and Stevens
Martin Vaughn and Tadych, PLLC to serve as counsel for the debtor
in the adversary proceeding.
GRUBB & ELLIS: Consummates Confirmed Liquidating Plan
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Grubb & Ellis Co., the real estate broker whose
business was sold in April 2012, implemented the liquidating
Chapters 11 plan April 1 that the bankruptcy court approved on
March 6.
The report relates that unsecured creditors, who voted
overwhelmingly for the plan, ere projected to have a recovery
between 1.7% and 4.7%. BGC Partners Inc. bought the business one
year ago partly in exchange for debt.
About Grubb & Ellis
Grubb & Ellis Company -- http://www.grubb-ellis.com/-- is a
commercial real estate services and property management company
with more than 3,000 employees conducting throughout the United
States and the world. It is one of the oldest and most recognized
brands in the industry.
Grubb & Ellis and 16 affiliates filed for Chapter 11 bankruptcy
(Bankr. S.D.N.Y. Lead Case No. 12-10685) on Feb. 21, 2012, to sell
almost all its assets to BGC Partners Inc. The Santa Ana,
California-based company disclosed $150.16 million in assets and
$167.2 million in liabilities as of Dec. 31, 2011.
Judge Martin Glenn presides over the case. The Debtors have
engaged Togut, Segal & Segal, LLP as general bankruptcy counsel,
Zuckerman Gore Brandeis & Crossman, LLP, as general corporate
counsel, and Alvarez & Marsal Holdings, LLC, as financial advisor
in the Chapter 11 case. Kurtzman Carson Consultants is the claims
and notice agent.
BGC Partners, Inc., and its affiliate, BGC Note Acquisition Co.,
L.P., the DIP lender and Prepetition Secured Lender, are
represented in the case by Emanuel C. Grillo, Esq., at Goodwin
Procter LLP.
On March 27, 2012, the Court approved the sale to BCG. An auction
was cancelled after no rival bids were submitted. Pursuant to the
term sheet signed by the parties, BGC would acquire the assets for
$30.02 million, consisting of a credit bid the full principal
amount outstanding under the (i) $30 million credit agreement
dated April 15, 2011, with BGC Note, (ii) the amounts drawn under
the $4.8 million facility, and (iii) the cure amounts due to
counterparties. BGC would also pay $16 million in cash because
the sale was approved by the March 27 deadline. Otherwise, the
cash component would have been $14 million.
Approval of the sale was simplified when BGC settled with
unsecured creditors by increasing their recovery. Grubb & Ellis
Co. was renamed Newmark Grubb Knight Frank following the sale.
As reported by the TCR on Nov. 20, 2012, Grubb & Ellis filed a
liquidating Chapter 11 plan which gives unsecured creditors an
expected recovery between 1.7% and 4.7%. The Court approved the
explanatory disclosure materials in January 2013. The
confirmation hearing for approval of the Plan was held on March 6.
GSC GROUP: Kaye Scholer Says GSC Can't Seek Sanctions After Deal
----------------------------------------------------------------
Helen Christophi of BankruptcyLaw360 reported that Kaye Scholer
LLP urged a New York bankruptcy court Friday to toss GSC Group
Inc. and Black Diamond Capital Management LLC's bid for sanctions
against the firm, saying a $1.5 million settlement it reached with
the U.S. trustee in February barred the motion.
The report related that Kaye Scholer and firm partner Michael B.
Solow asked the court to award the firm costs in opposing the
motion, saying the pending settlement it agreed to with the U.S.
trustee, which had sought to oust it from GSC's Chapter 11 case,
precluded the Debtor and Black Diamond from seeking sanctions
against the firm.
About GSC Group
Florham Park, New Jersey-based GSC Group, Inc. --
http://www.gsc.com/-- was a private equity firm that specialized
in mezzanine and fund of fund investments. Originally named
Greenwich Street Capital Partners Inc. when it was a subsidiary of
Travelers Group Inc., GSC became independent in 1998 and at one
time had $28 billion of assets under management. Market reverses,
termination of some funds, and withdrawal of customers'
investments reduced funds under management at the time of
bankruptcy to $8.4 billion.
GSC Group, Inc., filed for Chapter 11 bankruptcy protection
(Bankr. S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010, estimating
assets at $1 million to $10 million and debts at $100 million
to $500 million as of the Chapter 11 filing.
Effective Jan. 7, 2011, James L. Garrity Jr., was named Chapter 11
trustee for the Debtors. The Chapter 11 trustee completed the
sale of business in July 2011 and filed a liquidating Chapter 11
plan and explanatory disclosure statement in late August. The
bankruptcy court authorized the trustee to sell the business to
Black Diamond Capital Finance LLC, as agent for the secured
lenders. Proceeds were used to pay secured claims. The price
paid by the lenders' agent was designed for full payment on
$256.8 million in secured claims, with $18.6 million cash left
over. Black Diamond bought most assets with a $224 million credit
bid, a $6.7 million note, $5 million cash, and debt assumption. A
minority group of secured lenders filed an appeal from the order
allowing the sale. Through a suit in state court, the minority
lenders failed to halt Black Diamond from completing the sale.
The Chapter 11 Trustee and Black Diamond filed rival repayment
plans for GSC Group. The Chapter 11 trustee reached a handshake
deal on Dec. 13, 2011, ending the dispute with Black
Diamond that delayed a $235 million asset sale.
Michael B. Solow, Esq., at Kaye Scholer LLP, served as the
Debtor's bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, was
the Debtor's notice and claims agent. Capstone Advisory Group LLC
served as the Debtor's financial advisor.
The Chapter 11 trustee tapped Shearman & Sterling LLP as his
counsel, and Togut, Segal & Segal LLP as his conflicts counsel.
Black Diamond Capital Management, LLC, is represented by attorneys
at Latham & Watkins and Kirkland & Ellis LLP.
H.A. DENTON: Case Summary & 3 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: H.A. Denton LLC
155 N. Michigan Avenue, Suite 529
Chicago, IL 60601
Bankruptcy Case No.: 13-13027
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Pamela S. Hollis
Debtors' Counsel: George R. Mesires, Esq.
UNGARETTI & HARRIS, LLP
Three First National Plaza
70 W. Madison Street, Suite 3500
Chicago, IL 60602
Tel: (312) 977-4151
Fax: (312) 977-4405
E-mail: grmesires@uhlaw.com
Scheduled Assets: $1,068,071
Scheduled Liabilities: $1,119,775
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
Denkin, LLC 13-13035
Assets: $1,068,071
Debts: $1,119,775
The petitions were signed by Jerrold Ruskin, managing member.
A. A copy of H.A. Denton's list of its three largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/ilnb13-13027.pdf
B. A copy of Denkin's list of its three largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/ilnb13-13035.pdf
HAWKER BEECHCRAFT: Nyanjom Employee Suit Dismissed
--------------------------------------------------
Kansas District Judge Thomas Marten dismissed an employment
discrimination lawsuit Harold M. Nyanjom commenced against his
employer, Hawker Beechcraft.
Following confirmation of Hawker Beechcraft's Chapter 11 plan in
February 2013, the Kansas Court ordered Mr. Nyanjom to show cause
by March 28, 2013, why his lawsuit should not be dismissed. Mr.
Nyanjom filed his pro se Response to Hawker's bankruptcy status
report on March 11.
In a March 29, 2013 Order available at http://is.gd/9qiYiTfrom
Leagle.com, the Court ruled that Mr. Nyanjom has failed to show
sufficient cause why the case should not be dismissed with
prejudice.
The case is, HAROLD M. NYANJOM, Plaintiff, v. HAWKER BEECHCRAFT,
INC., Defendant, Case No. 12-1438-JTM (D. Kan.).
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kansas, manufactures business jets, turboprops and piston
aircraft for corporations, governments and individuals worldwide.
Hawker Beechcraft Inc. and 17 affiliates filed for Chapter 11
reorganization (Bankr. S.D.N.Y. Lead Case No. 12-11873) on May 3,
2012, having already negotiated a plan that eliminates $2.5
billion in debt and $125 million of annual cash interest expense.
The Debtor was 49%-owned by affiliates of Goldman Sachs Group Inc.
and 49%-owned by Onex Corp. The Company's balance sheet as of
Dec. 31, 2011, showed $2.77 billion in total assets, $3.73 billion
in total liabilities and a $956.90 million total deficit. Other
claims include pensions underfunded by $493 million.
Hawker's legal representative was Kirkland & Ellis LLP, its
financial advisor was Perella Weinberg Partners LP and its
restructuring advisor was Alvarez & Marsal. Epiq Bankruptcy
Solutions LLC served as claims and notice agent.
Sidley Austin LLP served as legal counsel and Houlihan Lokey
Howard & Zukin Capital Inc. served as financial advisor to the DIP
Agent and the Prepetition Agent. Wachtell, Lipton, Rosen & Katz
represented an ad hoc committee of senior secured prepetition
lenders holding 70% of the loans.
Milbank, Tweed, Hadley & McCloy LLP represented an ad hoc
committee of holders of the 8.500% Senior Fixed Rate Notes due
2015 and 8.875%/9.625% Senior PIK Election Notes due 2015 issued
by Hawker Beechcraft Acquisition Company LLC and Hawker Beechcraft
Notes Company. The members of the Ad Hoc Committee -- GSO Capital
Partners, L.P. and Tennenbaum Capital Partners, LLC -- held claims
or manage accounts that hold claims against the Debtors' estates
arising from the purchase of the Senior Notes. Deutsche Bank
National Trust Company, the indenture trustee for senior fixed
rate notes and the senior PIK-election notes, was represented by
Foley & Lardner LLP.
An Official Committee of Unsecured Creditors appointed in the case
selected Daniel H. Golden, Esq., and the law firm of Akin Gump
Strauss Hauer & Feld LLP as legal counsel. The Committee's
financial advisor served as FTI Consulting, Inc.
Hawker Beechcraft on Feb. 19 disclosed that it has formally
emerged from the Chapter 11 process as a new company. The company
changed its name to Beechcraft Corp. The company's Joint Plan of
Reorganization was approved by the Bankruptcy Court on Feb. 1,
2013, and became effective on Feb. 15.
The Plan offers 81.9% of the new stock in return for $921 million
of the $1.83 billion owing on the senior credit. Unsecured
creditors are to receive the remaining 18.9% of the new stock.
Holders of the senior credit will receive 86% of the new stock.
The senior credit holders are projected to have a 43.1% recovery
from the plan. General unsecured creditors' recovery is a
projected 5.7% to 6.3%. The recovery by holders of $510 million
in senior notes is predicted to be 9.2% to 10%.
HEMCON MEDICAL: Disclosures Approved, Plan Hearing on April 29
--------------------------------------------------------------
HemCon Medical Technologies, Inc., received approval from the U.S.
Bankruptcy Court for the District of Oregon of the disclosure
statement explaining their Fourth Amended Plan of Reorganization.
The hearing on confirmation of the Plan will be held on April 29,
2013, at 9:30 a.m. Objections to the proposed plan and ballots
accepting or rejecting the Plan must be filed on or before
April 22.
Before the Court approved the Disclosure Statement, the Debtor
amended it twice to include additional information. The Third
Amended Disclosure Statement provides, among other things, that
Class 3 (Bank of America, Bank of the West, and Silicon Valley
Bank claims) will be allowed in the amount of $22,720,035, less
any payments received during the period from the Petition Date to
the Effective Date. The Third Amended Disclosure Statement also
provided that Equity Security Holders will have the right, at any
time until 60 days after the Effective Date to subscribe to
purchase Series A Preferred Stock in NewCo.
The Third Amended Disclosure Statement also disclosed that the
United States provided funding for the development of HemCon's
Plasma Product (LyP) technology and certain other intellectual
property. According to the Debtor, representatives of the Army
have stated that the Army will not make funds available to HemCon
in the future. The Debtor says there can be no assurance that
NewCo will be able to establish a satisfactory working
relationship with the Army.
The Fourth Amended Disclosure Statement related that the Court has
granted the United States' motion for relief from stay for the
purpose of terminating the Cooperative Agreement between the
Debtor and the United States Army Medical Research and Acquisition
Activities.
A full-text copy of the Disclosure Statement dated March 12 is
available for free at http://bankrupt.com/misc/HEMCONds0312.pdf
A full-text copy of the Disclosure Statement dated March 19 is
available for free at http://bankrupt.com/misc/HEMCONds0319.pdf
About HemCon Medical Technologies
Portland, Oregon-based HemCon Medical Technologies Inc., fdba
HemCon, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D.
Ore. Case No. 12-32652) on April 10, 2012, estimating up to
$50 million in assets and liabilities. Founded in 2001, HemCon --
http://www.hemcon.com/-- is a diversified medical technology
company that develops, manufactures and markets innovative wound
care, anti-microbial and oral care products for the military,
emergency medical, surgical, dental and over-the-counter markets.
HemCon has subsidiaries in the United Kingdom and Europe.
The bankruptcy filing comes after an en banc decision by the U.S.
Court of Appeals for the Federal Circuit on March 15, 2012, which
affirmed an award of $34.2 million in damages to Marine Polymer
Technologies Inc. in a patent infringement case initiated in 2006.
HemCon's European subsidiary is not subject to the Chapter 11
proceedings.
Judge Elizabeth L. Perris presides over the case. Attorneys at
Tonkon Torp LLP represent the Debtor. The petition was signed by
Nick Hart, CFO.
The Official Committee of Unsecured Creditors appointed Marine
Polymer as its chair.
HOME CASUAL: Case Summary & 16 Unsecured Creditors
--------------------------------------------------
Debtor: Home Casual, LLC
2655 Research Park Drive
Fitchburg, WI 53711
Bankruptcy Case No.: 13-11475
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Western District of Wisconsin (Madison)
Judge: Robert D. Martin
Debtor's Counsel: J. David Krekeler, Esq.
KREKELER STROTHER, S.C.
2901 West Beltline Highway, Suite 301
Madison, WI 53713
Tel: (608) 258-8555
Fax: (608) 258-8299
E-mail: jdkrek@ks-lawfirm.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the Company's list of its 16 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/wiwb13-11475.pdf
The petition was signed by Donald D. Corning.
HOSTESS HOLDCO: S&P Assigns 'B-' CCR; Outlook Stable
----------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' corporate
credit rating to Kansas City, Mo.-based Hostess Holdco LLC. The
outlook is stable.
At the same time, S&P assigned a 'B-' issue-level rating to its
subsidiary New HB Acquisition LLC's (New HB) proposed $500 million
senior secured term loan due 2020. The recovery rating is '3',
indicating that lenders could expect meaningful (50% to 70%)
recovery of principal in the event of payment default. All
ratings are subject to review upon receipt and review of final
documentation.
Hostess, a newly formed company, is owned by investment funds
affiliated with Apollo Global Management LLC (Apollo) and
Metropoulos & Co. (Metropoulos), which recently won approval to
buy a majority of the Hostess snack cake assets out of bankruptcy
court.
"Our rating incorporates our understanding that certain Hostess
Brands Inc. assets are being sold free and clear of existing
material liabilities, including any existing employee-related
expenses such as pension and postretirement benefit obligations,"
said Standard & Poor's credit analyst Bea Chiem.
Hostess will use proceeds from the new $500 million term loan
along with roughly $192 million of common equity from Apollo
Management and Metropoulos & Co. to fund the purchase of the
Hostess Brands Inc.'s snack cake assets for $410 million,
$250 million to restart the business, and $32 million for fees
and expenses. At the close of the transaction, S&P estimates that
Hostess will have about $500 million in total debt outstanding and
no EBITDA.
HP GOLF: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: HP Golf Links, LLC
1900 Stirling Drive
Starkville, MS 39759
Bankruptcy Case No.: 13-11227
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Northern District of Mississippi (Aberdeen)
Debtors' Counsel: Craig M. Geno, Esq.
LAW OFFICES OF CRAIG M. GENO, PLLC
587 Highland Colony Parkway
Ridgeland, MS 39157
Tel: (601) 427-0048
E-mail: cmgeno@cmgenolaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
HP Real Estate LLC 13-11229
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
The petitions were signed by William W. Anderton, member.
HP Golf Links and HP Real Estate did not file their list of
creditors together with their petition.
IDEARC INC: Creditors Try Old Verizon Theory in New Court
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that creditors of Idearc Inc. began a $2.85 billion
lawsuit against Verizon Communications Inc. on March 29 in New
York state court seeking to resurrect part of a $9.8 billion suit
in federal court in Dallas that could be on the verge of complete
failure.
According to the report, the suit is based on the idea that
Idearc's corporate charter required two directors. Since Verizon
only ever named one director, Idearc was never properly formed as
a corporation, the committee contends. Consequently, Idearc
creditors have been taking the position that Verizon remained
liable for Idearc's debt, including $2.85 billion on 8% notes sold
when Idearc was spun off from Verizon.
The report recounts that Idearc had been a subsidiary of Verizon
until it was spun off in November 2006. It implemented a Chapter
11 reorganization plan in January 2010 mostly worked out before
the Chapter 11 filing in March 2009. Reducing debt from $9
billion to $2.75 billion, the plan created a trust to file
lawsuits on behalf of creditors, including the $9.8 billion suit
in Dallas federal court. In January 2013, the Dallas judge ruled
after a trial without jury that Idearc was solvent and worth $12
billion when spun off. Given solvency, the judge told both sides
to file papers explaining why the entire suit should or shouldn't
be dismissed. The Idearc creditors committee responded in mid-
March with papers contending that the company was never properly
formed, thus making Verizon liable for the debt.
The report notes that the new suit begun last week in New York
State Supreme Court is based on the same theory of defective
corporate formation. The new suit is being brought by the bank
that serves as indenture trustee for the $2.85 billion in notes.
The same bank, U.S. Bank NA, serves as trustee for the Idearc
creditor's trust. In that role, the bank is the plaintiff in the
Dallas suit. If the Dallas judge rejects the theory of improper
incorporation, the question will arise whether the suit in New
York fails automatically. Likewise, should the theory prevail,
there will be a similar question about whether the New York suit
is automatically successful.
The new suit in New York is U.S. Bank National Association v.
Coticchio, 651132/2013, New York State Supreme Court (Manhattan).
The creditors' lawsuit in Dallas is U.S. Bank National Association
v. Verizon Communications Inc., 10-01842, U.S. District Court,
Northern District Texas (Dallas).
About Idearc Inc.
Headquartered in D/FW Airport, Texas, Idearc, Inc., now known as
SuperMedia Inc., is the second largest U.S. yellow pages
publisher. Idearc was spun off from Verizon Communications, Inc.
Idearc and its affiliates filed for Chapter 11 protection (Bankr.
N.D. Tex. Lead Case No. 09-31828) on March 31, 2009. The Debtors'
financial condition as of Dec. 31, 2008, showed total assets of
$1,815,000,000 and total debts of $9,515,000,000. Toby L. Gerber,
Esq., at Fulbright & Jaworski, LLP, represented the Debtors in
their restructuring efforts. The Debtors tapped Moelis & Company
as their investment banker; Kurtzman Carson Consultants LLC as
their claims agent.
William T. Neary, the United States Trustee for Region 6,
appointed six creditors to serve on the official committee of
unsecured creditors. The Committee selected Mark Milbank, Tweed,
Hadley & McCloy LLP, as counsel, and Haynes and Boone, LLP, co-
counsel.
Idearc completed its debt restructuring and its plan of
reorganization became effective as of Dec. 31, 2009. In
connection with its emergence from bankruptcy, Idearc changed its
name to SuperMedia Inc. Under its reorganization, Idearc reduced
its total debt from more than $9 billion to $2.75 billion of
secured bank debt.
SuperMedia and three affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 13-10545) on March 18, 2013, to
effectuate a merger of equals with Dex One Corp.
IDERA PHARMACEUTICALS: EY LLP Raises Going Concern Doubt
--------------------------------------------------------
Idera Pharmaceuticals, Inc., filed on March 11, 2013, its annual
report on Form 10-K for the year ended Dec. 31, 2012.
Ernst & Young LLP, in Boston, Mass., expressed substantial doubt
about Idera's ability to continue as a going concern, citing that
the Company has recurring losses and negative cash flows from
operations and will be required to raise additional capital or
alternative means of financial support, or both, prior to Dec. 31,
2013, in order to continue to fund its operations.
The Company reported a net loss of $19.2 million on $51,000 of
revenue in 2012, compared with a net loss of $23.8 million on
$53,000 of revenue in 2011. Revenue in 2012 and 2011 consisted of
reimbursement by licensees of costs associated with patent
maintenance.
The Company's balance sheet at Dec. 31, 2012, showed $10.8 million
in total assets, $4.2 million in total liabilities, $5.9 million
of Series D Redeembale Convertible Preferred Stock, and
stockholders' equity of $706,000.
A copy of the Form 10-K is available at http://is.gd/FI6CDm
Cambridge, Massachusetts-based Idera Pharmaceuticals, Inc., is a
clinical stage biotechnology company engaged in the discovery and
development of novel synthetic DNA- and RNA-based drug candidates
that are designed to modulate immune responses mediated through
Toll-like Receptors, or TLRs. The Company has two drug
candidates, IMO-3100, a TLR7 and TLR9 antagonist, and IMO-8400, a
TLR7, TLR8, and TLR9 antagonist, in clinical development for the
treatment of autoimmune and inflammatory diseases.
INNOVATIVE COMMUNICATION: D.V.I. Court Won't Hear Suit v. Trustee
-----------------------------------------------------------------
Chief District Judge Curtis V. Gomez dismissed, for want of
jurisdiction, the action captioned OAKLAND BENTA; JOHN TUTEIN,
PETER WEISMAN; PETER WEISMAN & ASSOC.; JOHN P. RAYNOR; RAYNOR,
RENSCH & PFEIFFER; JAMES J. HEYING; PROSSER & CAMPBELL P.C.,
Plaintiffs, v. STAN SPRINGEL, as CHAPTER 11 TRUSTEE OF THE ESTATE
OF INNOVATIVE COMMUNICATION CORPORATION, Defendant, Civil Case No.
2012-36 (D. V.I.).
The Defendant sought dismissal of the Benta action.
The case arose out of the ongoing bankruptcy of the Innovative
Communication Corporation, a Virgin Islands telecommunications
company. Between July to September 2009, Stan Springel, as the
Chapter 11 Trustee of the ICC Estate, initiated adversary
proceedings against Benta et al. He sought to undo certain
transactions entered into between Benta et al. and ICC as
fraudulent conveyances or preferential transfers.
Benta et al. commenced its own action on May 11, 2012, seeking a
declaratory judgment that in light of the Supreme Court's recent
decision in Stern v. Marshall, 131 S.Ct. 2594 (2011), the
Bankruptcy Division cannot constitutionally render final judgments
in actions to avoid transfers as fraudulent conveyances.
The U.S. District Court for the Virgin Islands found that there is
an adequate, alternative forum in which Benta et al. can raise the
issues they raise in their action. Judge Gomez further found that
none of these five factors favor exercising juridiction over Benta
et al.'s action:
(1) the likelihood that a federal court declaration will resolve
the uncertainty of obligation which gave rise to the
controversy;
(2) the convenience of the parties;
(3) the public interest in settlement of the uncertainty of
obligation;
(4) the availability and relative convenience of other remedies;
and
(5) forum-shopping.
Accordingly, the Benta, et. al., action is dismissed, Judge Gomez
ruled in a March 20, 2013 Memorandum Opinion, a copy of which is
available at http://is.gd/72R0jZfrom Leagle.com.
Plaintiffs Oakland Benta, John Tutein, Peter Weisman, Peter
Weisman & Assoc., James Heying, and Prosser & Campbell, P.C. are
represented by:
Jeffrey B. C. Moorhead, Esq.
JEFFREY B. C. MOOREHEAD, P.C.
1132 King Street, Suite #3
Christiansted, St. Croix
U.S. Virgin Islands 00820-4953
Tel: (340) 773-2539
Fax: (340) 773-8659
Email: jeffreymlaw@yahoo.com
The ICC Chapter 11 trustee is represented by:
Benjamin A. Currence, Esq.
BENJAMIN A. CURRENCE P.C.
P.O. Box 6143
St. Thomas, VI 00804-6143
Tel: (340) 775-3434
Email: currence@surfvi.com
About Prosser & Innovative Communication
Headquartered in St. Thomas, Virgin Islands, Innovative
Communication Company, LLC -- http://www.iccvi.com/-- and
Emerging Communications, Inc., are diversified telecommunications
and media companies operating mainly in the U.S. Virgin Islands.
Jeffrey J. Prosser owns Emerging Communications and Innovative
Communications. Innovative and Emerging filed for Chapter 11
protection (D.V.I. Case Nos. 06-30007 and 06-30008) on July 31,
2006. When the Debtors filed for protection from their creditors,
they estimated assets and debts of more than $100 million.
Mr. Prosser also filed for chapter 11 protection (D. V.I. Case No.
06-10006) on July 31, 2006. According to The (Virgin Islands)
Source, he was fired in October 2007 for failing to make payments
into the company pension funds. The case was later converted to
Chapter 7 liquidation. James P. Carroll was named Chapter 7
Trustee.
Greenlight Capital Qualified, L.P., Greenlight Capital, L.P., and
Greenlight Capital Offshore, Ltd. -- which held an $18,780,614
claim against Mr. Prosser -- had filed an involuntary chapter 11
against Innovative Communication, Emerging Communications, and Mr.
Prosser on Feb. 10, 2006 (Bankr. D. Del. Case Nos. 06-10133,
06-10134, and 06-10135). Mr. Prosser argued that the Greenlight
entities, the former shareholders of Innovative Communications,
and Rural Telephone Finance Cooperative, Mr. Prosser's lender,
conspired to take down his companies into bankruptcy and collect
millions in claims.
The U.S. District Court of the Virgin Islands, Bankruptcy
Division, approved the U.S. Trustee for Region 21's appointment of
Stan Springel of Alvarez & Marsal as Chapter 11 Trustee of
Innovative and Emerging Communications.
INSPIREMD INC: Amends $30 Million Worth of Securities Offering
--------------------------------------------------------------
InspireMD, Inc., filed with the U.S. Securities and Exchange
Commission amendment no.5 to the Form S-1 registration statement
relating to the offering 11,111,111 shares of the Company's common
stock and 11,111 shares of the Company's Series A Convertible
Preferred Stock.
The Company intends to sell securities with an aggregate purchase
price of $30 million in this offering, with each purchaser having
the option to choose whether to purchase common stock, Preferred
Stock, or a combination of common stock and Preferred Stock. For
each share of Preferred Stock purchased in the offering, the
Company will reduce the number of shares of common stock being
sold in the offering by 1,000. The Company's common stock is
quoted on the OTC Bulletin Board under the symbol "NSPR." On
March 18, 2013, the last reported sale price of the Company's
common stock was $2.70 per share.
The Company has applied to list its shares of common stock on the
NYSE MKT under the symbol "NSPR." The Company is not listing its
Preferred Stock on an exchange or any trading system and the
Company does not expect that a trading market for its Preferred
Stock will develop.
A copy of the amended prospectus is available for free at:
http://is.gd/b1FY77
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.
INTCOMEX INC: S&P Revises Outlook to Neg. & Affirms 'B' CCR
------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Miami-
based Intcomex Inc. to negative from stable and affirmed the 'B'
corporate credit rating.
In addition, S&P affirmed its 'B-' issue-level rating on the
company's second-priority senior secured notes. The recovery
rating on this debt remains '5', indicating S&P's expectation that
lenders can expect modest (10% to 30%) recovery in the event of a
payment default.
"The outlook revision is based on our expectation that weakness in
the company's 2012 operating performance will result in less than
15% covenant headroom in the near term," said Standard & Poor's
credit analyst Martha Toll-Reed.
Standard & Poor's Ratings Services' ratings on Intcomex reflect
its expectation that the company's modest earnings and cash flow
from operations, as well as geographic concentration in Latin
American markets, will limit near-term improvement in the
company's "highly leveraged" financial risk profile. Intcomex's
"vulnerable" business risk profile reflects its relatively narrow
geographic presence and second-tier position in the highly
competitive and global distribution market. However, the company
should benefit over the next 12 to 24 months from a relatively
diverse customer base, low PC penetration rates in Latin America,
and expansion of its distribution of mobile devices.
The negative outlook reflects S&P's expectation that covenant
headroom will be compressed in the near term, but that earnings
growth will restore adequate headroom over the next several
quarters. If Intcomex restores adequate headroom as anticipated,
the outlook will be stabilized. Volatile market conditions,
leading to reduced operating earnings and sustained leverage in
excess of 6.5x, could lead to lower ratings.
INTELLIPHARMACEUTICS INT'L: Closes $3.1-Mil. Offering of Units
--------------------------------------------------------------
Intellipharmaceutics International Inc. has closed its previously
announced registered direct unit offering for gross proceeds of
approximately US$3.1 million at a price of US$1.72 per unit. The
Company sold units comprised of an aggregate of 1,815,000 common
shares and warrants to purchase an additional 453,750 common
shares. The warrants are exercisable immediately, have a term of
five years and an exercise price of US$2.10 per common share.
After placement agent fees and estimated offering expenses, the
Company received net proceeds from the offering of approximately
US$2.7 million.
Roth Capital Partners, LLC, served as lead placement agent for the
offering. Brean Capital and Maxim Group LLC served as co-
placement agents for the transaction.
Intellipharmaceutics intends to use the net proceeds to file
additional Abbreviated New Drug Applications (ANDAs) with the Food
and Drug Administration, to advance clinical trials for its abuse
resistant RexistaTM technology or other NDA 505(b)(2)
opportunities, to establish additional partnerships, and for
working capital, research, product development and general
corporate purposes.
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: CEO Plans to Sell 962,963 Common Shares
--------------------------------------------------------
Jay Sugarman, the chairman and chief executive officer of iStar
Financial Inc., intends to enter into a trading plan pursuant to
Rule 10b5-1 under the Securities Exchange Act of 1934, as amended,
covering the sale from time to time of up to 962,963 shares of the
Company's common stock owned by him over a 12-month period. The
number of shares covered by the plan is equal to the number of
restricted stock units held by Mr. Sugarman that are expected to
vest on Jan. 1, 2014. The plan contemplates that shares will be
sold in monthly pro rata installments, subject to certain
criteria. Any unsold shares in a particular month may be added to
future monthly sales.
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.
iStar Financial incurred a net loss of $241.43 million in 2012,
and a net loss of $25.69 million in 2011. The Company's balance
sheet at Dec. 31, 2012, showed $6.15 billion in total assets,
$4.82 billion in total liabilities, $13.68 million in redeemable
noncontrolling interests, and $1.31 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.
IT FACTORY: Chapter 15 Case Summary
-----------------------------------
Chapter 15 Debtor: IT Factory A/S
aka ITF A/S
c/o Boris K. Frederiksen, in his
capacity as the duly appointed Trustee of the
bankruptcy estate of IT Factory A/S
Vester Farimagsgade 23
1606 Copenhagen, Denmark
Chapter 15 Case No.: 13-10954
Chapter 15 Petition Date: March 29, 2013
Court: Southern District of New York (Manhattan)
Judge: Martin Glenn
Chapter 15 Debtor's Counsel: David Farrington Yates, Esq.
DENTONS US LLP
1221 Avenue of the Americas
24th Floor
New York, NY 10020
Tel: (212) 768-6700
Fax: (212) 768-6800
E-mail: farrington.yates@dentons.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $0 to $50,000
The petition was signed by Boris K. Frederiksen.
JENSEN MOVERS: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Jensen Movers & Storage, Inc.
11 Church Road
Hatfield, Pa 19440
Bankruptcy Case No.: 13-12560
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Jean K. FitzSimon
Debtor's Counsel: David L. Marshall, Esq.
EASTBURN & GRAY, P.C.
775 Pennllyn-Blue Bell Pike
Blue Bell, PA 19422
Tel: (215) 345-7000
E-mail: dmarshall@eastburngray.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Ana Maria Jones, president.
JSC ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: JSC Enterprises, LLC
dba Conner Auto Group
P.O. Box 360
Waurika, OK 73573
Bankruptcy Case No.: 13-11420
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Western District of Oklahoma (Oklahoma City)
Judge: Sarah A. Hall
Debtor's Counsel: Stephen J. Moriarty, Esq.
FELLERS SNIDER
100 N. Broadway Avenue, Suite 1700
Oklahoma City, OK 73102-8820
Tel: (405) 232-0621
Fax: (405) 232-9659
E-mail: smoriarty@fellerssnider.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/okwb13-11420.pdf
The petition was signed by Steve Conner, manager.
JUDSON COLLEGE: S&P Lowers Long-Term Bond Rating to 'BB+'
---------------------------------------------------------
Standard & Poor's Ratings Services has lowered its long-term
rating to 'BB+' from 'BBB-' on the Educational Building Authority
of the City of Marion, Ala.'s series 2010 bonds issued for Judson
College.
"The rating reflects our view of the college's large fiscal 2012
operating deficit, which is likely a one-time departure from its
historically balanced operations on a full accrual basis, but
leaves Judson susceptible to increased credit risk when combined
with already weak financial resources, a high maximum annual debt
service burden, above-average endowment spend rate, and high debt
level relative to size and budget," said Standard & Poor's credit
analyst Avani Parikh. "In addition, for the past two years, the
college has increased its reliance on its lines of credit to
support working capital needs, which we believe limits cash flow
flexibility," said Ms. Parkih.
These weaknesses are currently balanced by the college's growing
enrollment trends, record of historically balanced operating
performance, consistently positive net tuition revenue growth, and
continued compliance with its covenant to maintain endowment to
debt coverage of more than 1.25x. In addition, the college
receives strong financial support from the Alabama Baptist State
Convention, which is an important credit factor that supports the
rating. The convention's contribution, which has typically
exceeded $1 million, fell to $962,000 in fiscal 2012 and $915,000
in fiscal 2011. Management attributes the decreased amount partly
to an accounting adjustment as well as the economic downturn and
expects the fiscal 2013 contribution to be similar to that of
fiscal 2012. In Standard & Poor's view, a trend of lower
contributions could present a credit risk.
The stable outlook reflects Standard & Poor's view that over the
two-year outlook period, the Alabama Baptist State Convention will
likely continue to provide significant support to the college and
student demand and enrollment will remain stable or increase.
Standard & Poor's also expects the college will likely return to
balanced operations on a full accrual basis in fiscal 2013 due to
management's focus on expense controls and year-to-date
performance.
KV PHARMACEUTICAL: Securities Suit May Proceed Against Hermelin
---------------------------------------------------------------
In the class action lawsuit, PUBLIC PENSION FUND GROUP, et al.,
Plaintiffs, v. KV PHARMACEUTICAL COMPANY, et al., Defendants, No.
4:08-CV-1859 (CEJ) (E.D. Mo.), District Judge Carol E. Jackson
granted the request of Public Pension Fund Groups to proceed
against Marc Hermelin, but not against KV.
On Dec. 2, 2008, Joseph Mas filed a complaint against KV and its
executive officers alleging that they had issued materially false
and misleading statements regarding KV's compliance with federal
regulations as well as KV's current and future financial
prospects. The lawsuit was brought as a class action on behalf of
purchasers of KV securities. Subsequently, two additional class
action lawsuits were filed against KV alleging similar violations.
In an order dated April 15, 2009, the Court consolidated the three
securities class actions and appointed Public Pension as lead
plaintiff. On May 22, 2009, Public Pension filed a consolidated
amended complaint against defendants KV, Mr. Hermelin, and two
other individuals, alleging violations of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5(a)-(c) promulgated
thereunder. The defendants filed separate motions to dismiss
which were granted by the Court.
On March 18, 2010, Public Pension filed a motion for relief from
the order of dismissal and for leave to amend the complaint.
Public Pension also filed a notice of appeal of the order of
dismissal. On Oct. 20, 2010, Public Pension's motion for relief
was denied and the notice of appeal was docketed in the U.S. Court
of Appeals for the Eighth Circuit. On June 4, 2012, the Court of
Appeals issued an opinion affirming in part and reversing in part,
and the case was remanded to the E.D. Mo. District Court.
On Aug. 4, 2012, KV filed a voluntary Chapter 11 bankruptcy
petition. On Aug. 10, 2012, the E.D. Mo. District Court, sua
sponte, entered an Order staying all proceedings in the class
action pending completion of the bankruptcy case. The phrase "all
proceedings" meant that all actions against KV and Hermelin were
temporarily stayed.
On Nov. 28, 2012, Public Pension filed a motion with the
Bankruptcy Court seeking relief from the stay order as it related
to KV so that Public Pension could file an amended complaint.
Public Pension subsequently withdrew this motion. On Dec. 6,
2012, Public Pension filed the motion to modify the stay as it
relates to Mr. Hermelin.
Public Pension does not dispute the Court's authority to stay the
proceedings as to the KV. Public Pension argues, however, that
the stay should not have extended to Mr. Hermelin, a nondebtor
defendant.
The E.D. Mo. Court agrees that its Aug. 10, 2012 order staying the
proceedings against Mr. Hermelin was inappropriate.
A copy of the Court's March 28, 2013 Memorandum and Order is
available at http://is.gd/BfMdSgfrom Leagle.com.
About K-V Pharmaceutical
K-V Pharmaceutical Company (NYSE: KVa/KVb) --
http://www.kvpharmaceutical.com/-- is a fully integrated
specialty pharmaceutical company that develops, manufactures,
markets, and acquires technology-distinguished branded and
generic/non-branded prescription pharmaceutical products. The
Company markets its technology distinguished products through
ETHEX Corporation, a subsidiary that competes with branded
products, and Ther-Rx Corporation, the company's branded drug
subsidiary.
K-V Pharmaceutical Company and certain domestic subsidiaries on
Aug. 4, 2012, filed voluntary Chapter 11 petitions (Bankr.
S.D.N.Y. Lead Case No. 12-13346, under K-V Discovery Solutions
Inc.) to restructure their financial obligations.
K-V employed Willkie Farr & Gallagher LLP as bankruptcy counsel,
Williams & Connolly LLP as special litigation counsel, and SNR
Denton as special litigation counsel. In addition, K-V tapped
Jefferies & Co., Inc., as financial advisor and investment banker.
Epiq Bankruptcy Solutions LLC is the claims and notice agent.
The U.S. Trustee appointed five members to serve in the Official
Committee of Unsecured Creditors. Kristopher M. Hansen, Esq.,
Erez E. Gilad, Esq., and Matthew G. Garofalo, Esq., at Stroock &
Stroock & Lavan LLP, represent the Creditors Committee.
Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R.
Fife, Esq., represent an Ad Hoc Senior Noteholders Group.
KNL PROPERTIES: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: KNL Properties, Inc.
dba Ramada Limited Suites
fka Ramada Properties, Inc.
248 Hunting Court
Jonesboro, GA 30236
Bankruptcy Case No.: 13-56970
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Northern District of Georgia (Atlanta)
Debtor's Counsel: Paul Reece Marr, Esq.
PAUL REECE MARR, P.C.
300 Galleria Parkway, N.W., Suite 960
Atlanta, GA 30339
Tel: (770) 984-2255
Fax: (770) 984-0044
E-mail: paul@paulmarr.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Kyung ("Susie") Hae Lee, chief
executive officer.
LA CAMBRE: Case Summary & 10 Unsecured Creditors
------------------------------------------------
Debtor: La Cambre Properties LLC
1112 E. Donegan Avenue
Kissimmee, FL 34744
Bankruptcy Case No.: 13-03860
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Middle District of Florida (Orlando)
Debtor's Counsel: Samuel R. Pennington, Esq.
PENNINGTON LAW FIRM, P.A.
303 N. Texas Avenue
Tavares, FL 32778
Tel: (352) 508-8277
Fax: (352) 508-5796
E-mail: srplawgail66@earthlink.net
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 10 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/flmb13-03860.pdf
The petition was signed by Barry Compton, president.
LA JOLLA: Richard Reinisch Holds 8.3% Equity Stake at March 21
--------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission on March 21, 2013, Richard Reinisch disclosed that he
beneficially owns 1,100,000 shares of common stock of La Jolla
Pharmaceutical Company representing 8.3% of the shares
outstanding. A copy of the regulatory filing is available at:
http://is.gd/I0ls1b
About La Jolla Pharmaceutical
San Diego, Cal.-based La Jolla Pharmaceutical Company (OTC BB:
LJPC) -- http://www.ljpc.com/-- is a biopharmaceutical company
that has historically focused on the development and testing of
Riquent as a treatment for Lupus nephritis.
La Jolla reported a net loss of $11.54 million in 2011, compared
with a net loss of $3.76 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$3.40 million in total assets, $12.93 million in total
liabilities, all current, $5.80 million in Series C-1 redeemable
convertible preferred stock, and a $15.33 million total
stockholders' deficit.
After auditing the 2011 results, BDO USA, LLP, in San Diego,
California, expressed substantial doubt about the Company's
ability to continue as a going concern. The independent auditors
noted that the Company has suffered recurring losses from
operations, has an accumulated deficit of $439.6 million and a
stockholders' deficit of $15.6 million as of Dec. 31, 2011, and
has no current source of revenues.
LEXARIA CORP: Incurs $112K Net Loss in Fiscal 2013 1st Quarter
--------------------------------------------------------------
Lexaria Corp. filed its quarterly report on Form 10-Q, reporting a
net loss of $112,074 on $351,491 of revenue for the three months
ended Jan. 31, 2013, compared with a net loss of $118,921 on
$249,383 of revenue for the three months ended Jan. 31, 2012.
The Company's balance sheet at Jan. 31, 2013, showed $3.9 million
in total assets, $1.6 million in total liabilities, and
stockholders' equity of $2.3 million.
A copy of the Form 10-Q is available at http://is.gd/GlTVSG
Lexaria Corp. was incorporated in the State of Nevada on Dec. 9,
2004. The Company is an independent natural gas and oil company
engaged in the exploration, development and acquisition of oil and
gas properties in the United States and Canada. The Company's
entry into the oil and gas business began on Feb. 3, 2005. The
Company has offices in Vancouver and Kelowna, BC, Canada.
* * *
As reported in the TCR on Feb. 5, 2013, MNP LLP, in Vancouver,
Canada, expressed substantial doubt about Lexaria Corp.'s ability
to continue as a going concern. The independent accountants noted
that the Company had recurring losses and requires additional
funds to maintain its planned operations.
LIBERTY MEDICAL: Schedules Filing Deadline Extended to April 16
---------------------------------------------------------------
Liberty Medical and its affiliates obtained an order extending the
deadline to file its scheduled assets and liabilities to April 16,
2013.
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.
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 filed applications to employ 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.
LHC LLC: May 5 Set as Claims Bar Date
-------------------------------------
Creditors of LHC LLC must file their proofs of claim not later
than May 6, 2013. Governmental proofs of claim are due by
Sept. 2, 2013.
The Debtor was required to submit their schedules of assets and
liabilities by March 25, 2013, after the court granted a two-week
extension.
LHC, LLC owns and operates a multiple sheet ice rink facility
commonly known as the "Leafs Ice Centre" at 801 Wesemann Drive,
West Dundee, Illinois. The facility was constructed in 2007 using
proceeds from the sale of sports facility revenue bonds by the
Illinois Finance Authority.
LHC, LLC, filed for Chapter 11 petition (Bank. N.D. Ill. Case No.
13-07001) on Feb. 25, 2013. Peter A. Buh signed the petition as
president. The Debtor estimated assets and debts of at least $10
million. Judge Donald R. Cassling presides over the case. The
Debtor is represented by Crane Heyman Simon Welch & Clar.
LIBERTY MEDICAL: Court Approves Epiq as Administrative Advisor
--------------------------------------------------------------
ATLS Acquisition, LLC, et al., entities that own the Liberty
Medical diabetics supply business, obtained Court approval to
employ Epiq Bankruptcy Solutions, LLC, as administrative advisor,
nunc pro tunc to their Petition Date. The Debtors said that the
size, complexity of business and their relatively small workforce
make it necessary to retain Epiq to provide administrative
services.
As administrative advisor, Epiq will, among other things, assist
the Debtors with the solicitation and balloting of votes in
connection with a Chapter 11 plan. For the solicitation and
tabulation services, Epiq will charge $290 per hour for work
performed by the executive vice president, and $250 per hour for
work performed by the vice president and director of solicitation.
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 filed applications to employ 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: Debtor, Creditors Rebut IRS on Hospitals' Sale
-----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Internal Revenue Service objects to LifeCare
Holdings Inc.'s request to sell its hospitals to senior lenders in
exchange for $320 million in secured debt. The IRS objects to the
sale because it will produce no cash to pay a $24 million capital
gains tax. The government wants the bankruptcy judge to require
other creditors to share payments they receive on claims that
arose during bankruptcy.
According to the report, LifeCare, the creditors' committee, and
the lenders all line up against the IRS. They say there is no
requirement that a sale during bankruptcy produce enough cash to
assure the ability to complete a Chapter 11 reorganization plan.
The committee says that sales are often approved in bankruptcy
court, to be followed by a "structured dismissal or conversion" to
liquidation in Chapter 7.
The report notes that even if approved at the April 2 hearing, the
sale won't be completed until July, given the need for regulatory
approvals, the company previously said. LifeCare also 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 $353.4 million owing on the
secured credit facility with JPMorgan Chase Bank NA as agent.
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.
LIGHT GLOBAL: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Light Global Mission Church
3901 Fair Ridge Drive, #200
Fairfax, VA 22033
Bankruptcy Case No.: 13-11337
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Brian F. Kenney
Debtor's Counsel: Richard A. Golden, Esq.
GOLDEN & GOLDEN, P.C.
10627 Jones Street, Suite 101B
Fairfax, VA 22030
Tel: (703) 691-0117
Fax: (703) 691-1367
E-mail: k8los@aol.com
Estimated Assets: $0 to $50,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/vaeb13-11337.pdf
The petition was signed by Steve Sekyu Chang, Sr. Pastor &
authorized agent.
LLS AMERICA: Defendants Fined for Failure to Respond to Discovery
-----------------------------------------------------------------
Bankruptcy Judge Patricia C. Williams issued identifical decisions
regarding a motion to compel discovery filed by the Chapter 11
trustee of LLS America, LLC, in two adversary proceedings the
trustee commenced against:
-- Angela Mirrow, Alex Mirrow and Save It, LLC (BRUCE P.
KRIEGMAN, solely in his capacity as court-appointed
Chapter 11 Trustee for LLS America, LLC, Plaintiff, v.
PAUL COOPER, et al., Defendants, Adv. Proc. No. 11-80093
(Bankr. E.D. Wash.); and
-- Tyler Foerstner (BRUCE P. KRIEGMAN, solely in his capacity
as court-appointed Chapter 11 Trustee for LLS America,
LLC, Plaintiff, v. TYLER FOERSTNER, Defendant, Adv. Proc.
No. 11-80110 (Bankr. E.D. Wash.).
The purpose of the Court's decision is to resolve and provide
guidance to parties concerning the motions to compel discovery.
Specifically, Judge granted the plaintiff's request to compel
discovery; slapped a $500 fine against the defendants in each
adversary proceeding -- with the fine payable to the plaintiff's
counsel -- for failure to respond to requests for production of
documents and appear at a March hearing; and set an April 15
deadline for the defendants to challenge the sanction, or submit
an explanation regarding the failure to respond to many of the
interrogatories and requests to produce documents.
A copy of the Court's March 28, 2013 Memorandum Decision is
available at http://is.gd/zTrmTWfrom Leagle.com.
About Little Loan Shoppe
LLS America LLC, doing business as Little Loan Shoppe, operated an
online payday loan business. Affiliate Team Spirit America
provided the manpower, management and equipment for Little Loan
Shoppe. The companies are among a multitude of Canadian and
American business entities owned and operated by Doris E. Nelson,
a/k/a Dee Nelson, a/k/a Dee Foster. Investors claimed Ms. Nelson
operated a Ponzi scheme. Ms. Nelson allegedly told investors they
could earn as much as 60% on money her companies used to make
payday loans to consumers. American and Canadian investors bought
notes worth US$29 million and another C$26,000,000. However, the
investors received no payments after March 2009.
One investor group placed a related company, LLS-A LLC, into
bankruptcy in July 10, 2009.
LLS America LLC filed for bankruptcy (Bankr. D. Nev. Case No.
09-23021) on July 21, 2009, before Judge Linda B. Riegle. Gregory
E. Garman, Esq., at Gordon Silver, served as the Debtor's counsel.
In its petition, the Debtor disclosed $2,661,584 in assets and
$24,013,837 in debts. The petition was signed by Ralph Gamble,
CEO of the Company.
The case was subsequently moved to Washington state (Bankr. E.D.
Wash. Case No. 09-06194). Charles Hall was appointed as examiner
in the case.
LODGENET INTERACTIVE: Plan Effective
------------------------------------
BankruptcyData reported that LodgeNet Interactive's Amended
(Prepackaged) Plan of Reorganization became effective, and the
Company emerged from Chapter 11 protection.
According to documents filed with the Court, "The Plan represents
the culmination of extensive negotiations between the Debtors, a
steering committee representing the Prepetition Lenders and Colony
Capital, LLC ('Colony Capital'). The steering committee of the
lenders under the Debtors' Prepetition Credit Facility, who
collectively hold approximately 44% of the Prepetition Lender
Claims, have executed a Plan Support and Lock-Up Agreement
pursuant to which they have agreed to support and vote in favor of
the Plan. On the Effective Date of the Plan, subject to the
satisfaction or waiver of the conditions to closing set forth in
the Investment Agreement, a group of investors led by an affiliate
of Colony Capital will purchase 100% of the shares of New Common
Stock in Reorganized LodgeNet Interactive for at least $60 million
in the aggregate and will purchase warrants to purchase additional
New Common Stock," the BankruptcyData report cited.
About LodgeNet
Sioux Falls, South Dakota-based LodgeNet Interactive Corporation
(Nasdaq: LNET) -- http://www.lodgenet.com/-- provides interactive
media and connectivity services to hospitality and healthcare
businesses and the consumers they serve. Recently named by
Advertising Age as one of the Leading 100 US Media Companies,
LodgeNet Interactive serves roughly 1.5 million hotel rooms
worldwide in addition to healthcare facilities throughout the
United States.
As of Sept. 30, 2012, LodgeNet, on a consolidated basis, reported
$292 million in assets and $449 million in liabilities.
LodgeNet Interactive and its affiliates sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 13-10238) on Jan. 27,
2013, with a prepackaged Chapter 11 plan of reorganization.
The plan extends the maturity date and modifies a $332.6 million
term loan and $21.5 million revolver. Colony Capital, LLC, is
acquiring 100% of the new shares of the reorganized company for
$60 million.
Weil, Gotshal & Manges LLP serves as counsel to the Debtors;
Leonard Street and Deinard is the co-counsel; Miller Buckfire &
Co., LLC and Moorgate Bankers are the investment banker; FTI
Consulting, Inc. is the financial advisor; and Kurtzman Carson
Consultants is the claims and notice agent.
LODGNET INTERACTIVE: Sullivan & Cromwell Aids Colony's $70M Recap
-----------------------------------------------------------------
Liz Hoffman of BankruptcyLaw360 reported that real estate private
equity firm Colony Capital LLC has acquired LodgeNet Interactive
Corp. through a $70 million recapitalization and a new $358
million long-term loan, installing new management and paving the
media company's path out of a quick prepackaged bankruptcy.
The report related that the transaction wipes out existing
preferred and common stockholders and installs Colony as
LodgeNet's new owner, with 100 percent of its shares. The report
added that purchase price and new credit facility are both sized
up from an original plan sketched out in December.
About LodgeNet
Sioux Falls, South Dakota-based LodgeNet Interactive Corporation
(Nasdaq: LNET) -- http://www.lodgenet.com/-- provides interactive
media and connectivity services to hospitality and healthcare
businesses and the consumers they serve. Recently named by
Advertising Age as one of the Leading 100 US Media Companies,
LodgeNet Interactive serves roughly 1.5 million hotel rooms
worldwide in addition to healthcare facilities throughout the
United States.
As of Sept. 30, 2012, LodgeNet, on a consolidated basis, reported
$292 million in assets and $449 million in liabilities.
LodgeNet Interactive and its affiliates sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 13-10238) on Jan. 27,
2013, with a prepackaged Chapter 11 plan of reorganization.
The plan extends the maturity date and modifies a $332.6 million
term loan and $21.5 million revolver. Colony Capital, LLC, is
acquiring 100% of the new shares of the reorganized company for
$60 million.
Weil, Gotshal & Manges LLP serves as counsel to the Debtors;
Leonard Street and Deinard is the co-counsel; Miller Buckfire &
Co., LLC and Moorgate Bankers are the investment banker; FTI
Consulting, Inc. is the financial advisor; and Kurtzman Carson
Consultants is the claims and notice agent.
M & M INVESTORS: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: M & M Investors, Inc.
dba Grant County Gazette
Southwest Kansas Gazette
Tiger Lily
Gazette TV
fdba Sports Page 2
P.O. Box 279
Ulysses, KS 67880
Bankruptcy Case No.: 13-10675
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
District of Kansas (Wichita)
Judge: Robert E. Nugent
Debtor's Counsel: Edward J. Nazar, Esq.
REDMOND & NAZAR, LLP
245 North Waco, Suite 402
Wichita, KS 67202
Tel: (316) 262-8361
Fax: (316) 263-0610
E-mail: ebn1@redmondnazar.com
Scheduled Assets: $1,618,810
Scheduled Liabilities: $1,193,828
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ksb13-10675.pdf
The petition was signed by Julie Moral, vice president/secretary.
MARY HAD A LITTLE RAM: Case Summary & 12 Unsecured Creditors
------------------------------------------------------------
Debtor: Mary Had a Little Ram, LLC
a Virginia limited liability company
P.O. Box 1451
Bristol, VA 24203
Bankruptcy Case No.: 13-50547
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Eastern District of Tennessee (Greeneville)
Judge: Marcia Phillips Parsons
Debtor's Counsel: Mary Foil Russell, Esq.
HALE, LYLE & RUSSELL
P.O. Box 274
Bristol, TN 37621-0274
Tel: (423) 989-6555
Fax: (423) 989-6550
E-mail: mrussell@halelyle.com
Scheduled Assets: $1,960,200
Scheduled Liabilities: $2,278,959
A copy of the list of 12 largest unsecured creditors is
available for free at http://bankrupt.com/misc/tneb13-50547.pdf
The petition was signed by Russell A. Morrell, sole
member/manager.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
Mary Had a Little Ram, LLC, 12-51542 08/23/12
a TN limited liability company
MASHANTUCKET (WESTERN): S&P Gives Prelim CCC+ Issuer Credit Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned Mashantucket, Conn.-
based Mashantucket (Western) Pequot Tribe (the Tribe) its 'CCC+'
preliminary issuer credit rating. The preliminary rating outlook
is stable.
At the same time, S&P assigned the Tribe's proposed $297 million
term loan A due 2018, $260 million term loan B due 2020, and
$30 million term loan C (some of which could be revolving) due
2015 its 'CCC+' preliminary issue-level rating (the same as S&P's
preliminary issuer credit rating). The proposed issuance is part
of the Tribe's comprehensive debt refinancing transactions. The
Tribe is also in the process of executing exchange offers for
their other classes of debt, which S&P will not rate as part of
this transaction.
S&P do not assign recovery ratings to Native American debt issues
because there are sufficient uncertainties surrounding the
exercise of creditor rights against a sovereign nation, including
whether the Bankruptcy Code would apply, whether a U.S. court
would ultimately be the appropriate venue to settle such a matter,
and to what extent a creditor would be able to enforce any
judgment against a sovereign nation.
S&P's preliminary ratings are subject to its review of final
documentation and the completion of the exchange offers.
S&P's preliminary 'CCC+' issuer credit rating on the Tribe
reflects its assessment of its business risk profile as
"vulnerable" and its assessment of its financial risk profile as
"highly leveraged," according to S&P's criteria.
S&P's business risk profile assessment of vulnerable reflects the
Tribe's reliance on a single property for cash flow and
competitive dynamics in the region. In addition, the business
risk profile takes into account S&P's expectation for a
substantial increase in competition located in Massachusetts in
early 2016, which S&P expects will result in a meaningful decline
in the customer base and cash flow generation.
S&P's assessment of the Tribe's financial risk profile as highly
leveraged takes into account adjusted debt to EBITDA that S&P
expects to remain above 9x through the end of fiscal 2014. It
also reflects S&P's expectation that EBITDA generation through
2015 will approximate fixed charges, which include cash interest
expense, capital spending, amortization payments, and
distributions to the Tribe. After 2015, S&P expects EBITDA
coverage of fixed charges may weaken below 1x, depending on the
start of Massachusetts gaming and S&P's expectation that it will
likely pressure the Tribe's cash flow. The Tribe's gaming
operations derive a substantial amount of revenue from customers
located in Massachusetts. Under this scenario, S&P believes that
it is unlikely cash flow generation will be able to support the
proposed capital structure.
MCC HUMBLE: U.S. Trustee Wins Chapter 11 Case Dismissal
-------------------------------------------------------
Bankruptcy Judge Letitia Z. Paul dismissed the Chapter 11 case of
MCC Humble Auto Paint Inc., at the behest of the United States
Trustee. Dismissal is with prejudice to the filing of another
Chapter 11 case within 180 days after the date of entry of the
Judgment. The Debtor does not oppose dismissal, but requests that
dismissal be ordered without prejudice. A copy of the Court's
March 29, 2013 Memorandum Opinion is available at
http://is.gd/IcOUw7from Leagle.com.
About MCC Humble Auto Paint
MCC Humble Auto Paint, Inc. -- aka MCC Humble Auto Paint and Maaco
Collision Repair and Auto Painting -- filed for Chapter 11
bankruptcy (Bankr. S.D. Texas Case No. 11-34994) on June 7, 2011,
listing under $1 million in assets and debts. A copy of the
Debtor's petition is available at no charge at
http://bankrupt.com/misc/txsb11-34994.pdf
MCCLATCHY CO: Nominates Former Wells Fargo Executive to Board
-------------------------------------------------------------
The Board of Directors of The McClatchy Company has nominated
Clyde W. Ostler, a former executive with Wells Fargo & Company, as
a director. Mr. Ostler will stand for election at McClatchy's
2013 annual meeting of shareholders.
Donley Ritchey, a McClatchy director since 1985 and chair of the
board's audit committee, has announced his retirement following
the annual meeting of shareholders.
"We're delighted that Clyde has agreed to be nominated to
McClatchy's Board of Directors. McClatchy will benefit from
Clyde's executive experience at a leading financial institution
along with his service on numerous for-profit and not-for-profit
boards," said McClatchy Chairman Kevin S. McClatchy.
"I also want to thank Don for his many contributions to the
company over his nearly 28 years of service on the board,"
McClatchy continued. "Don has been a steadying influence as the
company expanded across the United States and diversified into our
growing digital and direct marketing businesses. Don's dedication
and diligence helped McClatchy navigate a historically challenging
economy and remain on sound financial footing. We wish him all
the best in retirement."
Mr. Ostler retired from Wells Fargo in 2011 as group executive
vice president, vice chairman of Wells Fargo Bank California and
president of Wells Fargo Family Wealth. Over his 40-year career
with Wells Fargo, he served in a number of capacities, including
vice chairman in the Office of the President, CFO, chief auditor,
head of retail branch banking, head of information technology,
head of institutional and personal investments and head of
internet services. He was a member of Wells Fargo's management
committee for more than 25 years.
Mr. Ostler has extensive experience serving on the boards of
public companies. He currently serves on the board of EXLService
Holdings, Inc., and is a member of the advisory council of FTV
Capital, a private global investment company. He is chairman of
the Scripps Institution of Oceanography Directors' Advisory
Council.
"I am proud and excited to be nominated to the McClatchy board at
such a pivotal time in the company's 156-year history," Mr. Ostler
said. "This company has a tremendous legacy of journalistic
excellence and is working hard to secure a significant future.
I'm looking forward to contributing to McClatchy's continued
success."
Ritchey retires as McClatchy's longest serving director who helped
steer McClatchy's transformation from a small, privately held
company into the nation's third-largest newspaper publisher with a
fast-growing digital business.
A former chairman and CEO of Lucky Stores, Inc., a California-
based supermarket chain and general retailer, Mr. Ritchey joined
the McClatchy board in July 1985 when McClatchy owned just five
daily newspapers and only two of them - the Tri-City Herald in
Washington state and the Anchorage Daily News in Alaska -
published outside of California's Central Valley. At the time,
the company also owned two AM radio stations, four cable systems
and a half dozen community newspapers.
"McClatchy is an extraordinary company and having been a director
for these many years has been a very satisfying experience," Mr.
Ritchey said. "Together, we have achieved growth and met
challenges, but the commitment to quality journalism has remained
unwavering. McClatchy is disciplined, profitable and people-
centered. I am confident of its future."
McClatchy President and CEO Pat Talamantes worked closely with
Ritchey during Talamantes' 11 years as the company's CFO.
"McClatchy today enjoys a solid reputation as a well-managed,
financially disciplined company thanks in large part to Don's
leadership, influence and hard work over the years," Talamantes
said. "And yet Don made sure the pursuit of profits never
interfered or diminished this company's mission and capability to
provide our communities with high-quality news and information.
All of us at McClatchy owe Don a big debt of gratitude."
About The McClatchy Company
Sacramento, Cal.-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).
The McClatchy incurred a net loss of $144,000 in 2012, as compared
with net income of $54.38 million in 2011. The Company's balance
sheet at Dec. 30, 2012, showed $3 billion in total assets, $2.96
billion in total liabilities, and $42.50 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.
MEDICAL INVESTORS: Case Summary & 6 Unsecured Creditors
-------------------------------------------------------
Debtor: Medical Investors, LLC
3961 Teays Valley Road
Hurricane, WV 25526
Bankruptcy Case No.: 13-30143
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Southern District of West Virginia (Huntington)
Judge: Ronald G. Pearson
Debtor's Counsel: Joseph W. Caldwell, Esq.
CALDWELL & RIFFEE
P.O. Box 4427
Charleston, WV 25364-4427
Tel: (304) 925-2100
Fax: (304) 925-2193
E-mail: joecaldwell@frontier.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
A copy of the Company's list of its six unsecured creditors filed
with the petition is available for free at:
http://bankrupt.com/misc/wvsb13-30143.pdf
The petition was signed by Darrin Vanscoy, member.
MEGANET CORP: Incurs $267K Net Loss in Sept. 30 Quarter
-------------------------------------------------------
Meganet Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $267,024 on $nil revenues for the three
months ended Sept. 30, 2012, compared with a net loss of $214,645
on $35,518 of revenues for the three months ended Sept. 30, 2011.
For the six months ended Sept. 30, 2012, the Company reported a
net loss of $512,559 on $1,161 of revenues, compared with a net
loss of $441,453 on $79,620 of revenues for the six months ended
Sept. 30, 2011.
The Company's balance sheet at Sept. 30, 2012, showed $1.0 million
in total assets, $839,905 in total current liabilities, and
stockholders' equity of $180,984.
The Company has incurred losses since inception and has an
accumulated deficit of $2,645,761 as of Sept. 30, 2012. "The
Company requires capital for its contemplated operational and
marketing activities. The Company's ability to raise additional
capital through the future issuances of common stock is unknown.
The obtainment of additional financing, the successful development
of the Company's contemplated plan of operations, and its
transition, ultimately, to the attainment of profitable operations
are necessary for the Company to continue operations. The ability
to successfully resolve these factors raise substantial doubt
about the Company's ability to continue as a going concern."
A copy of the Form 10-Q is available at http://is.gd/e97bKW
Las Vegas, Nevada-based Meganet Corporation is focused on the
development of data security solutions for enterprise, large
organizations and corporations around the globe, including the
U.S. Department of Defense, Military Intelligence and the Federal
Government. The Company's data security solutions include a
patented encryption algorithm which enhances security
exponentially. The Company out-sources the manufacture of its
counter-IED products, including bomb jammers, dismounted backpack
portable jammers and facility jammers. The Company also develops
and sells cell phone, satellite and wireless interceptors. Other
data security solutions include encrypted cell phones, land lines,
fax, PDA, radio, and satellites. Intelligence and counter-
intelligence solutions include the development of SPY and RAT
phones and devices for intelligence gathering. Counter-
intelligence solutions include bugs, bug detectors, bomb sniffers,
miniature cameras and digital video recorders. The Company
maintains technology development, executive and sales offices in
Las Vegas, Nevada.
MIDWEST GAMING: S&P Withdraws 'B+' Corporate Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'B+' corporate
credit rating on U.S. gaming operator Midwest Gaming Borrower LLC.
S&P withdrew the rating at the issuer's request, following the
company's full repayment of its senior credit facility, which
consisted of a $10 million revolver and a $110 million term loan,
and the company's senior notes.
MILAGRO OIL: Expects to Default on 2011 Credit Facility
-------------------------------------------------------
Milagro Oil & Gas, Inc., currently has indebtedness outstanding
under a 2011 first lien credit agreement, which contains customary
financial and other covenants.
The maximum leverage ratio, as defined, of debt balances as
compared to EBITDA is required to be not greater than 4.25 to 1.0,
and is expected to be 4.13 as of Dec. 31, 2012. The maximum
leverage ratio will reduce to 4.0 to 1.0 as of March 31, 2013, and
all periods thereafter.
The Company is currently exploring a range of alternatives to
reduce its indebtedness to the extent necessary to be in
compliance with the maximum leverage ratio at March 31, 2013. The
Company is also considering seeking a waiver or amendment to the
2011 Credit Facility with respect to the maximum leverage ratio.
The Company has engaged a financial advisor to assist with, among
other things, reducing its indebtedness and seeking that waiver or
amendment from its lenders.
Because the Company cannot provide assurances as to its ability to
remain in compliance with its financial covenants, the Company
expects to receive a going concern modification in the audit
report from its independent registered public accounting firm for
the year ended Dec. 31, 2012. The 2011 Credit Facility provides
that a going concern modification from an independent registered
public accounting firm is a covenant breach. As a result of this
anticipated covenant breach, all of the Company's debt would be
classified within current liabilities in the consolidated balance
sheet at Dec. 31, 2012. In addition, the lenders under the 2011
Credit Facility would have the option to accelerate the debt and
initiate collateral enforcement actions, and prevent the Company
from borrowing additional funds under the 2011 Credit Facility.
The indenture governing the 10.500% Senior Secured Second Lien
Notes due 2016 provides that if a default occurs under the 2011
Credit Facility that results in the acceleration of such debt, the
Notes would also be in default and subject to acceleration. The
Company is working diligently with its lenders to resolve the
situation.
About Milagro Oil
Milagro Oil & Gas, Inc., is an independent energy company based in
Houston, Texas that is engaged in the acquisition, development,
exploitation, and production of oil and natural gas. The
Company's historic geographic focus has been along the onshore
Gulf Coast area, primarily in Texas, Louisiana, and Mississippi.
The Company operates a significant portfolio of oil and natural
gas producing properties and mineral interests in this region and
has expanded its footprint through the acquisition and development
of additional producing or prospective properties in North Texas
and Western Oklahoma.
The Company's balance sheet at Sept. 30, 2012, showed
$509 million in total assets, $461.3 million in total
liabilities, $235.4 million in Redeemable series A preferred
stock, and a stockholders' deficit of $187.7 million.
Going Concern Uncertainty
According to the regulatory filing, the 2011 Credit Facility
contains customary financial and other covenants, including
minimum working capital levels (the ratio of current assets plus
the unused availability of the borrowing base under the 2011
Credit Facility to current liabilities) of not less than 1.0 to
1.0, minimum interest coverage ratio, as defined, of not less than
2.50 to 1.0, maximum leverage ratio, as defined, of debt balances
as compared to EBITDA of not greater than 4.25 to 1.0 and maximum
secured leverage ratio, as defined, of secured debt balances as
compared to EBITDA of not greater than 2.00 to 1.0. The maximum
leverage ratio will reduce to 4.00 to 1.0 as of March 31, 2013,
and all periods thereafter.
"The Company is currently exploring a range of alternatives to be
in compliance with the financial covenant at the applicable dates.
Unless the Company is able to execute one or more of these
alternatives, the Company's maximum leverage ratio may not meet
the reduced threshold in the covenants beginning on March 31,
2013. In that event, the Company would have to seek a waiver or
amendment to these agreements and, if not granted, the lenders
could declare a default and the Company will not be able to borrow
additional funds under the facility. Accordingly, there is
substantial doubt of the Company's ability to continue as a going
concern."
* * *
As reported by the TCR on Nov. 29, 2012, Standard & Poor's Ratings
Services lowered its corporate credit rating on Houston-based
Milagro Oil & Gas Inc. to 'CCC' from 'CCC+'.
"The rating action reflects our assessment that Milagro could face
a near-term liquidity crisis," said Standard & Poor's credit
analyst Christine Besset.
MOTORS LIQUIDATION: Has Until Sept. 21 to Object to Claims
----------------------------------------------------------
The agreement governing the Motors Liquidation Company GUC Trust
provides that the trust administrator and trustee of the GUC Trust
has the authority to file objections to unsecured claims asserted
in the bankruptcy cases of Motors Liquidation Company and its
affiliated debtors. The GUC Trust Agreement further provides a
deadline by which the GUC Trust Administrator must file all
objections to Disputed General Unsecured Claims, which deadline
may be extended by order of the bankruptcy court for the Southern
District of New York.
On March 25, 2013, the Bankruptcy Court entered an order extending
the Claims Objection Deadline to Sept. 21, 2013. The Claims
Objection Deadline may in the future be extended beyond Sept. 21,
2013, by further order of the Bankruptcy Court.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on
June 1, 2009. The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin,
Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges
LLP, assist the Debtors in their restructuring efforts. Al Koch
at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as
the Chief Executive Officer for Motors Liquidation Company. GM
is also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP
is providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP. Garden City Group is the claims and notice
agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured
Creditors Holding Asbestos-Related Claims. Lawyers at Kramer
Levin Naftalis & Frankel LLP served as bankruptcy counsel to the
Creditors Committee. Attorneys at Butzel Long served as counsel
on supplier contract matters. FTI Consulting Inc. served as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31.
On Dec. 15, 2011, Motors Liquidation Company was dissolved. On
the Dissolution Date, pursuant to the Plan and the Motors
Liquidation Company GUC Trust Agreement, dated March 30, 2011,
between the parties thereto, the trust administrator and trustee
-- GUC Trust Administrator -- of the Motors Liquidation Company
GUC Trust, assumed responsibility for the affairs of and certain
claims against MLC and its debtor subsidiaries that were not
concluded prior to the Dissolution Date.
MPG OFFICE: Samuelson Replaces Lazar as Accounting Head
-------------------------------------------------------
Jeanne M. Lazar, MPG Office Trust, Inc.'s Chief Accounting
Officer, resigned as an employee and officer of the Company
effective March 29, 2013.
Kelly E. Samuelson, 39, has been promoted to Vice President, Chief
Accounting Officer and will serve as the Company's principal
accounting officer effective immediately. Ms. Samuelson's term of
employment will end Dec. 31, 2013. Following that period, her
employment with the Company will become "at-will."
Prior to her promotion, Ms. Samuelson served as the Company's Vice
President, Business Initiatives & Applications from July 2008 to
March 2013. From May 2003 to July 2008, she served as the
Company's Controller and from July 2001 to May 2003 as the
Company's Assistant Controller. Ms. Samuelson joined the Company
in 1999 as a Property Accounting Manager. Prior to joining MPG
Office Trust, Mr. Samuelson spent almost three years in the real
estate practice group at Arthur Andersen LLP where she was a
senior accountant serving public and private real estate
companies. Ms. Samuelson holds a Bachelor of Science degree in
Accounting, magna cum laude, from Loyola Marymount University in
Los Angeles, California.
About MPG Office Trust
MPG Office Trust, Inc., fka Maguire Properties Inc. --
http://www.mpgoffice.com/-- owns and operates Class A office
properties in the Los Angeles central business district and is
primarily focused on owning and operating high-quality office
properties in the Southern California market. MPG Office Trust is
a full-service real estate company with substantial in-house
expertise and resources in property management, marketing,
leasing, acquisitions, development and financing.
For the year ended Dec. 31, 2012, the Company reported net income
of $396.11 million, as compared with net income of $98.22 million
on $234.96 million of total revenue during the prior year. The
Company's balance sheet at Dec. 31, 2012, showed $1.46 billion
in total assets, $1.98 billion in total liabilities and a $518.32
million total deficit.
In its Form 10-K filing with the Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2012, the Company
said it is working to address challenges to its liquidity
position, particularly debt maturities, leasing costs and capital
expenditures. The Company said, "We do not currently have
committed sources of cash adequate to fund all of our potential
needs, including our 2013 debt maturities. If we are unable to
raise additional capital or sell assets, we may face challenges in
repaying, extending or refinancing our existing debt on favorable
terms or at all, and we may be forced to give back assets to the
relevant mortgage lenders. While we believe that access to future
sources of significant cash will be challenging, we believe that
we will have access to some of the liquidity sources identified
above and that those sources will be sufficient to meet our near-
term liquidity needs."
On March 11, 2013, the Company entered into an agreement to sell
US Bank Tower and the Westlawn off-site parking garage. The
transaction is expected to close June 28, 2013, subject to
customary closing conditions. The net proceeds from the
transaction are expected to be roughly $103 million, a portion of
which may potentially be used to make loan re-balancing payments
on the Company's upcoming 2013 debt maturities at KPMG Tower and
777 Tower.
Roughly $898 million of the company's debt matures in 2013.
"Our ability to access the capital markets to raise capital is
highly uncertain. Our substantial indebtedness may prevent us
from being able to raise debt financing on acceptable terms or at
all. We believe we are unlikely to be able to raise equity
capital in the capital markets," the Company said.
"Future sources of significant cash are essential to our liquidity
and financial position, and if we are unable to generate adequate
cash from these sources we will have liquidity-related problems
and will be exposed to material risks. In addition, our inability
to secure adequate sources of liquidity could lead to our eventual
insolvency."
MTR GAMING: S&P Revises Outlook to Stable & Affirms 'B-' CCR
-------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Chester, W.Va-based MTR Gaming Group Inc. to stable from negative.
S&P also affirmed its 'B-' corporate credit rating and issue-level
ratings on the company.
"Our outlook revision to stable reflects MTR's outperformance
relative to our expectations in recent periods," said Standard &
Poor's credit analyst Carissa Schreck.
In 2012, net revenue and EBITDA grew 15% and 17%, respectively,
compared with S&P's expectation for relatively flat net revenue
and EBITDA during the same period. Although MTR's Mountaineer and
Presque Isle Downs properties experienced declines due to
competitive pressure from the Cleveland market, the company's
newest gaming location Scioto Downs near Columbus, Ohio has been
able to ramp up in the face of additional competition in Columbus
and mitigate the declines at the other two properties. Although
S&P currently expects MTR to face continued competitive pressure
from new competition opening in the Cleveland market in the near
term, the stable outlook reflects S&P's view that it is no longer
concerned about the company's ability to withstand competitive
pressures in Ohio.
The corporate credit rating on MTR reflects S&P's assessment of
the company's business risk profile as "vulnerable" and S&P's
assessment of the company's financial risk profile as "highly
leveraged," according to S&P's criteria.
S&P's assessment of MTR's business risk profile as vulnerable
reflects its limited geographic diversity and the significant
competitive pressures the company faces from new competition in
Ohio.
S&P's assessment of MTR's financial risk profile as highly
leveraged reflects its expectation for the company's adjusted
debt-to-EBITDA ratio to remain above 6x and for adjusted EBITDA
coverage of interest expense to be in the mid-1x area over the
intermediate term, because S&P believes new and recently opened
competition will continue to weigh on operating performance in
2013 and 2014. Although S&P expects new gaming facilities in Ohio
to affect MTR's existing cash flow base, it also believes Scioto
Downs will continue to mostly offset declines at MTR's other two
properties.
S&P's stable rating outlook reflects its expectation for credit
metrics to be in line with the rating over the intermediate term.
Although S&P expects competitive pressures from new and recently
opened competition to intensify in 2013 and 2014, it is no longer
concerned about the company's ability to withstand the additional
competition.
S&P may upgrade the rating once it has observed the extent of the
competitive impact from new gaming facilities in Ohio once they
are all operational, and S&P believes that EBITDA coverage of
interest expense can be sustained in at least the mid-1x area.
S&P could lower its rating if operating performance in 2013 is
meaningfully weaker than current expectations. This would likely
result from weaker-than-expected performance at Scioto Downs,
coupled with more substantial declines in operating performance at
MTR's other two properties because of increased competition in
Ohio, which could drive EBITDA coverage of interest closer to or
below 1x.
MTS LAND: US Bank Says 3rd Amended Plan Lacks Information
---------------------------------------------------------
U.S. Bank National Association objects to the Disclosure Statement
for MTS Land, LLC, and MTS Golf, LLC's Third Amended Joint Plan of
Reorganization, filed March 1, 2013. US Bank said that the DS
cannot be approved because it does not contain adequate
information.
Specifically, U.S. Bank noted that the Third Disclosure Statement:
(1) does not disclose the present state of the administrative
expenses of these estates;
(2) does not contain drafts of the "restated" loan documents that
would purportedly govern U.S. Bank's post-confirmation rights and
obligations vis a vis the Debtors;
(3) describes several development concepts, but not a plan of
reorganization;
(4) does not disclose the source of the parcel valuations relied
on in the disclosure statement;
(5) does not appear to describe the treatment of U.S. Bank's claim
in the event U.S. Bank makes the Section 1111(b) election; and
(6) the description of U.S. Bank's claim is uncertain and
inconsistent.
A copy of U.S. Bank's objection to the Debtors' Third Disclosure
Statement is available at:
http://bankrupt.com/misc/mtsland.doc508.pdf
As reported in the TCR on March 28, 2013, the Debtors' Plan is a
100% payment plan. All creditors with Allowed Claims will be paid
the amount of their Allowed Claims in full through the Plan. The
Holders of Equity Securities of Debtors will retain all of their
legal interests.
U.S. Bank, owed $32,450,046.03 as of the Petition Date, will
receive through the Restated USB Loan Maturity Date, or that date
that is the 5th anniversary of the Effective Date, monthly
principal and interest payments on the Secured Portion of the
outstanding balance of the Restated USB Note amortized over a
period of 25 years at the USB Restated Interest Rate.
The USB Loan Maturity Date may be extended for up to 4 additional
periods of 6 months each, subject to certain conditions including
the payment of an extension fee of 0.25% of the then outstanding
principal balance of the Restated USB Note.
A copy of the Disclosure Statement for the Debtors' Third Amended
Joint Plan of Reorganization is available at:
http://bankrupt.com/misc/mtsland.doc493.pdf
About MTS Land
MTS Land, LLC, and MTS Golf, LLC, own and operate the now dormant
Mountain Shadows Golf Club. They filed separate Chapter 11
petitions (Bankr. D. Ariz. Case Nos. 12-16257 and 12-16257) in
Phoenix on July 19, 2012. Mountain Shadows Golf Club --
http://www.mountainshadowsgolfclub.com/-- is an 18 hole, par 56
course located at Paradise Valley. Nestled in the foothills of
Camelback Mountain, the 3,081-yard Executive course claims to be
one of the most scenic golf courses in Arizona. MTS Land and MTS
Golf are affiliates of Irvine, Cal.-based Crown Realty &
Development Inc. MTS Land and MTS Golf each estimated assets and
debts of $10 million to $50 million.
Judge Charles G. Case II oversees the Debtors' cases. Lawyers at
Gordon Silver serve as the Debtors' counsel. The petition was
signed by Robert A. Flaxman, administrative agent.
Lender U.S. Bank is represented by Steven D. Jerome, Esq., and
Evans O'Brien, Esq., at Snell & Wilmer L.L.P.
The U.S. Trustee for Region 14 advised the Court that an official
committee of unsecured creditors has not been appointed because an
insufficient number of persons holding unsecured claims against
the Debtors have expressed interest in serving on a committee.
The U.S. Trustee reserves the right to appoint a committee if
interest develop among the creditors.
NAVISTAR INTERNATIONAL: Updates 10-K; Faces Shareholder Suits
-------------------------------------------------------------
In connection with the amendment to Navistar International
Corporation's $1 billion senior secured term loan facility entered
into by Navistar, Inc., and its intention to issue up to $300
million of unsecured debt and to use the net proceeds to repay a
portion of the principal of the term loan, the Company discloses
the following:
2012 Annual Report Update for Discontinued Operations
The Company updated its Annual Report on Form 10-K for the year
ended Oct. 31, 2012, to reflect the reclassification of the
historical financial results of Workhorse Custom Chassis and
certain operations of the Monaco recreational vehicle business as
discontinued operations. Beginning in the first quarter of 2013,
the operating results of WCC and Monaco were reclassified to
discontinued operations and this change was reflected in the
Company's quarterly report on Form 10-Q for the period ended
Jan. 31, 2013, as filed on March 7, 2013. WCC and Monaco were not
material to the Company's Consolidated Balance Sheets or
Consolidated Statements of Cash Flows and have not been
reclassified in the respective financial statements. This
reclassification has no effect on the Company's net income and
should not be read as a restatement of the Company's 2012 Annual
Report.
Recent Shareholder Litigation
On March 19, 2013, a putative class action complaint, alleging
securities fraud, was filed against the Company by the
Construction Workers Pension Trust Fund - Lake County and
Vicinity, on behalf of itself and all other similarly situated
purchasers of the Company's common stock between the period of
Nov. 3, 2010, and Aug. 1, 2012. The complaint named the Company
as well as Daniel C. Ustian, the Company's former President and
Chief Executive Officer, and Andrew J. Cederoth, the Company's
current Executive Vice President and Chief Financial Officer as
defendants. The complaint alleges, among other things, that the
Company issued materially false and misleading statements
concerning the Company's financial condition and future business
prospects and that the Company misrepresented and omitted material
facts concerning the Company's financial disclosures with the U.S.
Securities and Exchange Commission with respect to the fact that
the U.S. Environmental Protection Agency did not certify the
Company's exhaust gas recirculation technology to meet 2010 EPA
emission standards. The plaintiffs in this matter seek
compensatory damages and attorneys' fees, among other relief.
On March 20, 2013, James Gould filed a derivative complaint on
behalf of the Company against the Company and certain of its
current and former directors and officers. The complaint alleges,
among other things, that certain of the Company's current and
former directors and officers committed a breach of fiduciary
duty, waste of corporate assets and were unjustly enriched in
relation to similar factual allegations made in the 10b5 case.
The plaintiff in this matter seeks compensatory damages, certain
corporate governance reforms, certain injunctive relief,
disgorgement of the proceeds of certain defendants' profits from
the sale of Company stock, and attorneys' fees, among other
relief.
Each of these matters is pending in the United States District
Court, Northern District of Illinois. The Company is unable to
make any determination at this time as to whether these actions
will have a material adverse effect on its financial condition or
results of operations.
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar incurred a net loss attributable to the Company of $3.01
billion for the year ended Oct. 31, 2012, compared with net income
attributable to the Company of $1.72 billion during the prior
year.
The Company's balance sheet at Oct. 31, 2012, showed $9.10 billion
in total assets, $12.36 billion in total liabilities and a $3.26
billion total stockholders' deficit.
* * *
In the Aug. 3, 2012, edition of the TCR, Moody's Investors Service
lowered Navistar International Corporation's Corporate Family
Rating (CFR), Probability of Default Rating (PDR), and senior note
rating to B2 from B1. The downgrade of Navistar's ratings
reflects the significant challenges the company will face during
the next eighteen months in re-establishing the profitability and
competitiveness of its US and Canadian truck operations in light
of the failure to achieve EPA certification of its EGR emissions
technology, the significant reductions in military revenues and
substantially higher engine warranty reserves.
As reported by the TCR on June 13, 2012, Standard & Poor's Ratings
Services lowered its ratings on Navistar International Corp.,
including the corporate credit rating to 'B+', from 'BB-'. "The
downgrade and CreditWatch placement reflect the company's
operational and financial setbacks in recent months," said
Standard & Poor's credit analyst Sol Samson.
As reported by the TCR on Jan. 24, 2013, Fitch Ratings has
affirmed the Issuer Default Ratings (IDR) for Navistar
International Corporation and Navistar Financial Corporation at
'CCC' and removed the Negative Outlook on the ratings. The
removal reflects Fitch's view that immediate concerns about
liquidity have lessened, although liquidity remains an important
rating consideration as NAV implements its selective catalytic
reduction (SCR) engine strategy. Other rating concerns are already
incorporated in the 'CCC' rating.
NELSON EDUCATION: Refinance Risk Cues Moody's to Cut CFR to Caa2
----------------------------------------------------------------
Moody's Investors Service downgraded Nelson Education Ltd.'s
corporate family rating to Caa2 from Caa1, probability of default
rating to Caa2-PD from Caa1-PD, and ratings on its revolving
credit facility and first lien term loan to B3 from B2, and
affirmed the Caa3 rating on the company's second lien term loan.
The ratings outlook remains negative.
The downgrade reflects elevated refinance risk related to Nelson's
upcoming debt maturities, particularly due to the company's high
leverage, challenges facing the book publishing industry, and
Moody's expectation for continued weak financial results in the
near term. Nelson's $50 million revolving credit facility comes
due on July 5, 2013 while its $285 million first lien term loan
matures on July 4, 2014 and its $152 million second lien term loan
matures on July 3, 2015. Moody's believes there is the potential
that Nelson's debt could be restructured through a distressed
exchange (which is equivalent to a default) as the maturity date
of the 2014 term loan draws near.
Ratings Downgraded:
Corporate Family Rating, to Caa2 from Caa1
Probability of Default Rating, to Caa2-PD from Caa1-PD
$50 million Revolving Credit Facility due July 2013, to B3
(LGD2, 29%) from B2 (LGD3, 32%)
$285 million First Lien Term Loan due July 2014, to B3 (LGD2,
29%) from B2 (LGD3, 32%)
Rating Affirmed:
$152 million Second Lien Term Loan due July 2015, unchanged at
Caa3 with the LGD rate revised to (LGD5, 81%) from (LGD5, 83%)
Outlook:
Unchanged at Negative
Ratings Rationale:
Nelson's Caa2 CFR primarily reflects elevated default risk, high
leverage (adjusted Debt/EBITDA near 9x expected for fiscal 2013),
ongoing curriculum spending delays in the K-through-12 education
market and limited EBITDA growth prospects. Moody's considers
Nelson's capital structure to be unsustainable at its current
level of operating performance. The rating incorporates the
potential for debt restructuring at discounts to par as conditions
in the education market will limit its flexibility to improve
results and reduce leverage substantially in the near term. The
rating however benefits from the company's position as one of the
leading publishers of educational texts in the Canadian higher
education and K-through-12 markets, together with solid
relationships with educational institutions, provincial education
ministries and various content providers. The rating also reflects
the company's ability to generate positive free cash flow despite
challenging circumstances.
The negative outlook reflects increased potential for a distressed
exchange as maturity dates of term debts approach.
A downgrade will occur in the near term if it increasingly appears
likely that the company will be unable to refinance its debt or if
the company's cash balance is consumed, likely due to negative
free cash flow generation.
An outlook revision or ratings upgrade is not expected unless
Nelson completes the refinance of its term loans. Following that,
good operating execution that leads to earnings growth, consistent
free cash flow generation and reduced leverage could lead to a
ratings upgrade.
The principal methodology used in rating Nelson was the Global
Publishing Industry Methodology published in December 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Nelson Education Ltd. provides publishing services for the
Canadian educational market. Nelson publishes college and K-
through-12 textbooks and reference materials, and supplements its
print publications with digital solutions. The company is owned by
funds managed by Apax Partners and OMERS Capital Partners and is
headquartered in Toronto, Ontario, Canada.
NEW ENERGY: District Court Won't Hear Natural Chem Dispute
----------------------------------------------------------
Natural Chem Holdings, LLC, failed to obtain an order for the
withdrawal of certain matters in the bankruptcy case of New Energy
Corp. to the U.S. District Court for the Northern District of
Indiana.
New Energy Corp. operates an ethanol plant in South Bend, Indiana.
After filing for bankruptcy protection, New Energy sought and
obtained court approval to sell substantially all its assets and
to establish bidding procedures for that sale.
Natural Chem expressed interest in bidding at the auction, but
didn't comply with the bidding procedures. The successful bidder
at auction was Maynards Industries (1991) Inc. and Biditup
Auctions Worldwide, Inc. Natural Chem has since objected to the
sale, saying the sale procedures were violated.
Natural Chem then moved to withdraw the reference of certain
matters to the bankruptcy court and stay the proceedings in the
bankruptcy court until it can be heard further on its contention
that collusive bidding influenced the auction.
In his ruling, District Judge Robert Miller concluded that (1)
Natural Chem doesn't have standing to seek to withdraw matters to
the district court or to stay matters; (2) if Natural Chem is
properly in the District Court, it hasn't shown any of the things
that must be shown for a district court to withdraw reference of a
matter to a bankruptcy court; and (3) if Natural Chem is properly
in the District Court and withdrawal is proper, Natural Chem
hasn't made the showings necessary for a stay.
In a March 22 order, District Judge Robert Miller opined: "Natural
Chem hasn't shown that it has standing to move to withdraw the
reference to the bankruptcy court or to move to stay disposal of
the proceeds of the sale of most of the debtor's assets. Natural
Chem hasn't shown that withdrawal of the reference to the
bankruptcy court is proper under today's understanding of the law.
Natural Chem hasn't shown that a stay of the bankruptcy
proceedings would be a proper -- or perhaps even a permissible --
exercise of the district court's discretion."
The District Court (1) overrules Natural Chem's objections to the
bankruptcy court's March 14, 2013 report and recommendation on the
motion for withdrawal of reference, (2) adopts the bankruptcy
court's report and recommendation, and (3) denies Natural Chem's
motion for withdrawal of certain matters to the District Court and
motion for stay pending ruling by the District Court.
A copy of Judge Miller's March 22 Memorandum and Order is
available at http://is.gd/tXrRwffrom Leagle.com.
NNN LENOX: "Roll-Up" Plan Meets Objection from Secured Creditor
---------------------------------------------------------------
NNN Lenox Park 9, LLC, delivered to the U.S. Bankruptcy Court for
the Western District of Tennessee, Western Division, a Chapter 11
plan of reorganization and accompanying disclosure statement,
which propose to impair unsecured creditors.
The Plan provides for the "roll-up" of the tenant-incommon (a
"TIC") interests of thirty-three single purpose limited liability
companies, including the Debtor, in improved real property located
in Memphis, Tennessee, into membership interests in a single
limited liability company
Under the Plan, allowed general unsecured claims are grouped into
two: the first group will be paid 50% within 12 months of the
Effective Date of the Plan and the other 50% within 24 months of
the Effective Date, while the other group will be paid 90% within
90 days of the Effective Date of the Plan. The allowed secured
claim of USB 2007-C33, LLC, totaling $7.5 million, will be paid
monthly with interest until the balance is paid in full. The
allowed unsecured claim of USB, totaling $9.7 million, will be
paid 65% of the amount.
Allowed claims of non-debtor TICs will receive general limited
liability company membership interests in the reorganized debtor
consistent with the proportion of their interests in the Debtor's
property prior to the effective date. The holder of interests
will also receive general limited liability company membership
interests in the reorganized debtor in exchange for new value.
Secured Creditor Objects
U.S. Bank National Association, as Trustee, a secured creditor,
objects to the Plan maintaining that the Debtor's Chapter 11 case
has no valid reorganizational purpose and that the bankruptcy
petition was filed in bad faith solely to frustrate the holder of
the membership interest from exercising its legal rights. US Bank
complains that the Plan is patently unconfirmable because it is
skeletal and does not provide adequate information for creditors
to make knowledgeable decision in accepting or rejecting the Plan.
The Plan, US Bank further complains, is not feasible, not
reasonable, unfair and inequitable.
A full-text copy of the Disclosure Statement dated March 25 is
available for free at http://bankrupt.com/misc/NNNLENOXds0325.pdf
About NNN Lenox
New Albany, Indiana-based NNN Lenox Park 9, LLC, owns the
undivided 2.795% tenant in common interest in two four-story
office buildings located at 3175 Lenox Park Drive & 6625 Lenox
Park Drive, Memphis, Shelby County, Tennessee. The Lenox Park
Buildings A & B contain 193,029 square footage of office space and
853 surface parking spaces in adjoining parking.
NNN Lenox filed a Chapter 11 petition (Bankr. S.D. Ind. Case No.
12-92686) in New Albany, Indiana, on Dec. 4, 2012, on the eve of a
non-judicial foreclosure of the Property in Memphis, Shelby
County, Tennessee. The Debtor, a Single Asset Real Estate as
defined in 11 U.S.C. Sec. 101(51B), estimated at least $10 million
in assets and liabilities. Judge Basil H. Lorch, III, presides
over the case.
Mubeen Aliniazee, president of Highpoint Management Solutions,
LLC, has been named the restructuring officer. Jeffrey M. Hester,
Esq., at Tucker Hester, LLC, in Indianapolis, serves as counsel to
the Debtor.
The Chapter 11 case of NNN Lenox Park 9, LLC, was transferred
from New Albany, Indiana to Memphis (Bankr. W.D. Tenn. Case No.
13-21936) effective Feb. 22, 2013. CWCapital Asset Management
LLC, solely in its capacity as special servicer, sought a transfer
of the case, noting that the Debtor's sole asset is a fractional
ownership of a property in Tennessee; the receiver, Commercial
Advisors Asset Services LLC, is a Memphis-based commercial real
estate firm; and most, if not all of the Debtor's creditors are
located in or around Tennessee and all debt owed by the Debtor
relates to the property. Venue in Indiana is based solely on the
location of the Debtor's sole member.
NORD RESOURCES: Termination of Copper Sales Pact Moved to June 30
-----------------------------------------------------------------
Nord Resources Corporation has amended its copper cathode sales
agreement with Red Kite Master Fund Limited for 100% of the
production from the Johnson Camp Mine, to extend its termination
date from March 31, 2013, to June 30, 2013.
After June 30, 2013, the agreement is renewable by mutual
agreement of both parties. Pursuant to the agreement, Red Kite
accepts delivery of the cathodes at the Johnson Camp Mine, and
pricing is based on the COMEX price for high-grade copper on the
date of sale.
In July 2010, Nord suspended mining new ore at the Johnson Camp
Mine as it sought financing to permit the company to restructure
its debt and provide additional capital for constructing a new
leaching pad. It continues to leach copper from the material
previously placed on the existing three pads on its property,
processing it through the Johnson Camp Mine's SX-EW plant. As
expected, the level of copper production and sales continue to
decline at a steady rate.
About Nord Resources
Based in Tuczon, Arizona, Nord Resources Corporation
(TSX:NRD/OTCBB:NRDS.OB) -- http://www.nordresources.com/-- is a
copper mining company whose primary asset is the Johnson Camp
Mine, located approximately 65 miles east of Tucson, Arizona.
Nord commenced mining new ore in February 2009.
On June 2, 2010, Nord Resources appointed FTI Consulting to advise
on refinancing structures and strategic alternatives.
Nord Resources reported a net loss of $10.31 million in 2011,
compared with a net loss of $21.20 million in 2010. The Company's
balance sheet at Sept. 30, 2012, showed $52.82 million in total
assets, $67.76 million in total liabilities and a $14.93 million
total stockholders' deficit.
NORTHERN STATES FINANCIAL: Incurs $12.6-Mil. Loss in 2012
---------------------------------------------------------
Northern States Financial Corporation filed on March 11, 2013, its
annual report on Form 10-K for the year ended Dec. 30, 2012.
Plante & Moran, PLLC, in Chicago, Illinois, said that the
Corporation has suffered recurring losses from operations and its
subsidiary Bank, NorStates Bank, is operating under a Consent
Order.
The Corporation reported a net loss of $12.6 million on
$16.1 million of net interest income in 2012, compared with a net
loss of $6.7 million on $18.5 million of net interest income in
2011. The Corporation recognized provisions to the allowance for
loan losses totaling $11.1 million during 2012 as compared with
$6.9 million during 2011, an increase of $4.2 million.
Net interest income declined $2.4 million to $16.1 million during
2012 due to decreases in earning assets.
The Company's noninterest income decreased in 2012 by $619,000 to
$3.5 million. This decrease to noninterest income was primarily
due to declines in gains on the sale of securities as the Company
recognized no gains in 2012 as compared to $527,000 in gains in
2011. Contributing to the decrease in noninterest income were net
losses of $247,000 taken on sales of other real estate owned as
compared with net gains of $17,000 during 2011.
The Corporation's balance sheet at Dec. 31, 2012, showed
$413.2 million in total assets, $397.3 million in total
liabilities, and stockholders' equity of $15.9 million.
Bank's Tier 1 Capital to Average Assets Ratio Below
Required Capital Levels Requi8red by the 2013 Consent Order
At Dec. 31, 2012, NorStates Bank's Tier 1 to average assets ratio
and total risked-based capital ratio were 6.67 percent and 12.11
percent, respectively. The Bank's Tier 1 Capital to average
assets ratio was below the capital levels required by the 2013
Consent Order of 8.00 percent while the Bank's total risked-based
capital ratio was above the 12.00 percent level required by the
2013 Consent Order.
Because the 2013 Consent Order establishes specific capital
amounts to be maintained by the Bank, the Bank may not be
considered better than "adequately capitalized" for capital
adequacy purposes. As an adequately capitalized institution, the
Bank may not accept, renew or roll over brokered deposits without
prior approval of the FDIC. In addition, other depositors,
including some local government entities, may not maintain their
deposits at the Bank if the Bank is no longer well capitalized.
A copy of the Form 10-K is available at http://is.gd/kpR2qM
Waukegan, Illinois-based Northern States Financial Corporation is
the parent bank holding company of NorStates Bank. During 2008,
the Company formed the subsidiary NorProperties, Inc., for the
purpose of managing and disposing of the Company's nonperforming
assets.
Aside from the stock of the Bank, stock of NorProperties, Inc.,
and cash, the Company has no other substantial assets.
NYC 36TH: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: NYC 36th LLC
aka District 36
29 W 36th Street
New York, NY 10018
Bankruptcy Case No.: 13-10928
Chapter 11 Petition Date: March 27, 2013
Court: U.S. Bankruptcy Court
Southern District of New York (Manhattan)
Debtor's Counsel: Frank Xu, Esq.
FRANK XU, LLP
305 Broadway, 14th Floor
New York, NY 10007
Tel: (212) 897-5866
Fax: (212) 901-0499
E-mail: frank@frankxulaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $50,001 to $100,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Hironori Kobayashi, interim manager.
OMNICOMM SYSTEMS: Cornelis Wit Holds 50.2% Stake at March 21
------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Cornelis Wit disclosed that, as of
March 21, 2013, he beneficially owns 76,866,258 shares of common
stock of OmniComm Systems, inc., representing 50.2% of the shares
outstanding. Mr. Wit previously reported beneficial ownership of
69,306,342 common shares or a 45.72% equity stake as of Dec. 31,
2011. A copy of the amended filing is available for free at:
http://is.gd/Gsbx3Q
About OmniComm Systems
Ft. Lauderdale, Fla.-based OmniComm Systems, Inc., is a healthcare
technology company that provides Web-based electronic data capture
("EDC") solutions and related value-added services to
pharmaceutical and biotech companies, clinical research
organizations, and other clinical trial sponsors principally
located in the United States and Europe.
OmniComm reported a net loss of $3.52 million in 2011, compared
with a net loss of $3.13 million in 2010. The Company's balance
sheet at Sept. 30, 2012, showed $2.81 million in total assets,
$30.21 million in total liabilities and a $27.40 million total
shareholders' deficit.
"The ability of the Company to continue in existence is dependent
on its having sufficient financial resources to bring products and
services to market for marketplace acceptance," the Company said
in its quarterly report for the period ended Sept. 30, 2012. "As
a result of our historical operating losses, negative cash flows
and accumulated deficits for the period ending September 30, 2012
there is substantial doubt about the Company's ability to continue
as a going concern."
PARK PLUMBING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Park Plumbing, Inc.
15556 S. 70th Court
Orland Park, IL 60462
Bankruptcy Case No.: 13-13149
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Eugene R. Wedoff
Debtor's Counsel: David P. Lloyd, Esq.
DAVID P. LLOYD, LTD.
615B S. LaGrange Road
LaGrange, IL 60525
Tel: (708) 937-1264
Fax: (708) 937-1265
E-mail: courtdocs@davidlloydlaw.com
Scheduled Assets: $106,170
Scheduled Liabilities: $1,169,831
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ilnb13-13149.pdf
The petition was signed by Thomas A. Pau, president.
PAT'S TRANSPORTATION: Case Summary & 17 Unsecured Creditors
-----------------------------------------------------------
Debtor: Pat's Transportation, LLC
dba Ashley Transportation
dba Tennessee Logistics
dba Anytime Truck and Trailer
dba Broadway Limousine
1700 Hayes Street, Ste 101
Nashville, TN 37203
Bankruptcy Case No.: 13-02810
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Middle District of Tennessee (Nashville)
Judge: Marian F. Harrison
Debtor's Counsel: Steven L. Lefkovitz, Esq.
LAW OFFICES LEFKOVITZ & LEFKOVITZ
618 Church St Ste 410
Nashville, TN 37219
Tel: (615) 256-8300
Fax: (615) 255-4516
E-mail: slefkovitz@lefkovitz.com
Scheduled Assets: $220,000
Scheduled Liabilities: $2,419,286
A copy of the Company's list of its 17 largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/tnmb13-02810.pdf
The petition was signed by Adam Brock, president.
PATRIOT COAL: Control Fight Set for April 23 Court Hearing
----------------------------------------------------------
Aurelius Capital Management, LP, and Knighthead Capital
Management, LLC, on behalf of certain funds and accounts that they
manage or advise and that hold a substantial amount of Patriot
Coal Corporation's 3.25% Convertible Senior Notes due 2013 and
8.25% Senior Notes due 2018, ask the Bankruptcy Court to enter an
order directing the appointment of a Chapter 11 trustee to control
the estates of those Debtors that are not signatories to
collective-bargaining or retiree-healthcare agreements with the
United Mine Workers of America.
As creditors and parties-in-interest in Patriot's jointly
administered cases, Aurelius Capital and Knighthead Capital state:
1. Of the 99 Debtors in Patriot's jointly administered action,
only 13 actually have obligations to the UMWA or union retirees
(the "Obligor Debtors") and that Patriot and its other 85 Debtor
subsidiaries (the "Non-Obligor Debtors") have no such obligations,
nor do they guarantee union liabilities held by anyone else. "To
be sure, the Non-Obligor Debtors do have obligations to other,
non-union creditors -- foremost amongst them, the Noteholders
here."
2. The Debtors' recent proposals to the UMWA are built on a plan
to satisfy union liabilities with the assets of the Non-Obligor
Debtors, which have no obligations to the UMWA.
3. Rather than moving expeditiously to take the Non-Obligor
Debtors out of bankruptcy, the debtors-in-possession have spent
nine months negotiating with the UMWA about these illegal
proposals, which are based on the faulty premise that the Non-
Obligor Debtors actually owe union benefits.
4. Only by appointing a trustee can the Court ensure that the
estates of the Non-Obligor Debtors are managed as the law require
-- in the best interests of their own actual creditors. "Indeed,
under black letter law the appointment of a trustee is required
when a company is unable to fulfill its duties to creditors. That
requirement is all the more urgent here, where the debtors-in-
possession are actively harming the creditor interests of eighty
six of its Debtors (i.e., the Non-Obligor Debtors) for the benefit
of creditor interests in just thirteen of the Debtors (i.e., the
Obligor Debtors). Only a trustee can set true the course and do
so before liquidation. One should be appointed promptly."
April 23 Hearing
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Bankruptcy Court in St. Louis will convene a
hearing on April 23 to consider approval of a request by two
noteholders for a trustee appointed for most of the Patriot
companies and a separate request by shareholders for an official
equity committee.
The report relates that in papers filed in August, shareholders
argued there are off-balance-sheet assets making the company
solvent. They pointed to $1.4 billion in tax-loss carryforwards
plus fraudulent-transfer lawsuits. Patriot, the official
creditors' committee, and several creditors filed papers on
March 29 opposing the appointment of an equity committee. The
company said the balance sheet has a $308 million negative book
value while losses in 2012 totaled $731 million. Patriot sees no
"substantial likelihood" of a "meaningful distribution" to
shareholders.
According to the report, at the April 23 hearing, noteholders
Aurelius Capital Management LP and Knighthead Capital Management
LLC will petition the judge to appoint a Chapter 11 trustee to
take over the Patriot parent company and 85 of its 98 units. The
noteholders point out that only 13 of the Patriot companies are
liable to the mine workers' union for claims arising from
modification of collective bargaining agreements and termination
of retiree health benefits. The other 86, according to the
noteholders, should be taken over by a trustee because they have
no liability on union or retirees' claims. The noteholders argue
that Patriot has already said it intends to make all the companies
pay the claims of workers and retirees, even the 86 that have no
liability. Aurelius and Knighthead are concerned that Patriot
will run out of cash and be liquidated, even though subsidiaries
not liable to the union are the most financially healthy. The
noteholders want a trustee appointed who could bring the 86
companies out of bankruptcy quickly while the other 13 deal with
their union and retiree liabilities.
The report notes that the bone of contention for the noteholders
is Patriot's intention of creating a trust to supply retiree
health benefit. The trust would be funded with a claim against
the companies and a sharing in future profits.
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.
PERFORMANT FINANCIAL: S&P Raises CCR to 'BB-'; Outlook Stable
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Performant Financial Corp. to 'BB-' from 'B+'. At the
same time, S&P raised the issue-level rating on the company's
senior secured credit facilities to 'BB' from 'BB-'; the '2'
recovery rating is unchanged. The outlook is stable.
"The upgrade reflects our revision of the business risk profile
assessment to 'weak' from 'vulnerable,' primarily resulting from
the company's diversification into the healthcare sector through
its CMS contract," said Standard & Poor's credit analyst Michael
Weinstein. Growth from this business segment contributed to the
company's double-digit revenue and EBITDA growth year-over-year in
2012. As of Dec. 31, 2012, revenue from the CMS contract
contributed approximately 26% to the company's total revenue base,
approximately double the contribution from the previous year.
Positive business considerations also include the company's long-
standing relationships with its student loan clients and the
relative predictability of its revenue stream, based on the
deferred payment model on rehabilitated loans. However, these
positive attributes are partially mitigated by what S&P believes
is a substantial ongoing business risk: Performant has significant
customer concentration, with its top five customers generating
about 81% of its total revenues as of Dec. 31, 2012. Overall, the
new ratings on Performant reflect what S&P considers to be the
company's "weak" business risk profile and "significant" financial
risk profile.
The stable outlook on Performant incorporates S&P's expectation
for continued strong revenue and EBITDA growth from the CMS
contract in 2013, and a growing pipeline of student loan defaults
over the next couple of years. The outlook also takes into
account S&P's expectation that the company's FFO to debt will
remain above 20%, absent a material debt-financed distribution or
acquisition. S&P expects the company to continue to generate
meaningful FOCF, which will provide increased liquidity and the
potential to fund significant debt repayments or acquisitions with
internally generated cash flow over the next couple of years.
If the loss of a customer or a significant, unexpected degradation
in the company's loan collection performance constrained FOCF
generation, S&P could lower the rating, especially if it resulted
in FFO to debt declining below 20% or leverage rising to the 4x
range.
Conversely, the company's majority private-equity ownership and
S&P's assessment of its aggressive longer-term financial policy
limit prospects for an upgrade despite credit metrics that could
support a higher rating in the near term. S&P could raise the
rating if the company were not controlled by Parthenon and S&P's
view of financial policy became consistent with an "intermediate"
financial risk profile, with leverage expected to remain
comfortably below 3x and FFO to debt significantly above 30%.
Even in such a scenario, S&P's view of the company's high customer
concentration and relatively small scale may preclude such an
upgrade.
PHOENIX-GREENVILLE'S INN: Case Summary & Creditors List
-------------------------------------------------------
Debtor: Phoenix-Greenville's Inn, LP
P.O. Box 5064
Greenville, SC 29606
Bankruptcy Case No.: 13-01912
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
District of South Carolina (Spartanburg)
Judge: John E. Waites
Debtor's Counsel: Robert A. Pohl, Esq.
POHL, P.A.
P.O. Box 27290
Greenville, SC 29616
Tel: (864) 361-4827
Fax: (864) 558-5291
E-mail: robert@pohlpa.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/scb13-01912.pdf
The petition was signed by Stephen T. Moore, president of The
Phoenix Inn, Inc., general partner.
POLYMEDIX INC: Brilacidin Maker Files for Chapter 7 Liquidation
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that PolyMedix Inc., a developer of a drug called
Brilacidin, filed a petition April 1 for Chapter 7 liquidation
(Bankr. D. Del. Case No. 13-10689).
The Radnor, Pennsylvania-based company ran up $96.6 million in
deficits since inception, without significant revenue. The
product in development is a small-molecule drug designed for
treatment of drug-resistant staphylococcus aureus.
The last balance sheet as of Sept. 30 listed assets of $8.1
million and liabilities totaling $12.5 million.
The stock briefly reached $70 a share in February 2012 and was
trading between $4 and $6 this year until just before bankruptcy.
POSITIVEID CORP: Market Opportunities for M-BAND and Dragonfly
--------------------------------------------------------------
PositiveID Corporation has published a report on market
opportunities and positioning for its M-BAND (Microfluidic Bio-
agent Autonomous Networked Detector) and Dragonfly technologies.
A copy of the report is available at http://is.gd/JU2fTN
PositiveID's M-BAND system, developed under contract with the U.S.
Department of Homeland Security Science and Technology
directorate, is a bio-aerosol monitor with fully integrated
systems for sample collection, processing and detection modules
that continuously analyze air samples for the detection of
bacteria, viruses, and toxins. Results are reported via a secure
wireless network in real time to give an accurate and up-to-date
status for fielded instruments.
PositiveID's Dragonfly technology is designed to deliver molecular
diagnostic results from a sample in less than 30 minutes, which
would enable accurate diagnostics leading to more rapid and
effective treatment than what is currently available with existing
systems. Dragonfly is being developed further for a broad range
of biological detection situations including radiation-induced
cell damage within the human body, strains of influenza and other
common pathogens and diseases such as E. coli, methicillin-
resistant staphylococcus aureus ("MRSA") and human papilloma virus
("HPV").
About PositiveID
Delray Beach, Fla.-based PositiveID Corporation has historically
developed, marketed and sold RFID systems used for the
identification of people in the healthcare market. Beginning in
early 2011, the Company has focused its strategy on the growth of
its HealthID business, including the continued development of its
GlucoChip, its Easy Check breath glucose detection device, its
iglucose wireless communication system, and potential strategic
acquisition opportunities of businesses that are complementary to
its HealthID business.
EisnerAmper LLP, in New York, expressed substantial doubt about
PositiveID's ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that the Company has a working capital
deficiency and an accumulated deficit. "Additionally, the Company
has incurred operating losses since its inception and expects
operating losses to continue during 2012.
The Company's balance sheet at Sept. 30, 2012, showed
$2.69 million in total assets, $6.23 million in total liabilities,
and a $3.54 million total stockholders' deficit.
POSITIVEID CORP: Inks Intercreditor Agreement with Boeing and TCA
-----------------------------------------------------------------
PositiveID Corporation entered into an Intercreditor and Non-
Disturbance Agreement among PositiveID and MicroFluidic Systems;
VeriGreen Energy Corporation, Steel Vault Corporation, IFTH NY
Sub, Inc., and IFTH NJ Sub, Inc.; The Boeing Company; and TCA
Global Credit Master Fund, LP. The Agreement sets forth the
agreement of Boeing and TCA as to their respective rights and
obligations with respect to the Boeing Collateral and the TCA
Collateral and their understanding relative to their respective
positions in the Boeing Collateral and the TCA Collateral.
The Boeing Collateral includes, among other things, all
Intellectual Property Rights in the MBAND Technology, including
without limitation certain patents and patent applications set
forth in the Agreement. The TCA Collateral includes any and all
property and assets of PositiveID. The liens of Boeing on the
Boeing Collateral are senior and prior in right to the liens of
TCA on the Boeing Collateral and those liens of TCA on the Boeing
Collateral are junior and subordinate to the liens of Boeing on
the Boeing Collateral.
About PositiveID
Delray Beach, Fla.-based PositiveID Corporation has historically
developed, marketed and sold RFID systems used for the
identification of people in the healthcare market. Beginning in
early 2011, the Company has focused its strategy on the growth of
its HealthID business, including the continued development of its
GlucoChip, its Easy Check breath glucose detection device, its
iglucose wireless communication system, and potential strategic
acquisition opportunities of businesses that are complementary to
its HealthID business.
EisnerAmper LLP, in New York, expressed substantial doubt about
PositiveID's ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that the Company has a working capital
deficiency and an accumulated deficit. "Additionally, the Company
has incurred operating losses since its inception and expects
operating losses to continue during 2012.
The Company's balance sheet at Sept. 30, 2012, showed
$2.69 million in total assets, $6.23 million in total liabilities,
and a $3.54 million total stockholders' deficit.
POWERWAVE TECHNOLOGIES: Common Stock Delisted From NASDAQ
---------------------------------------------------------
The NASDAQ Stock Market LLC filed a Form 25 with the U.S.
Securities and Exchange Commission regarding the removal from
listing or registration of the common stock of Powerwave
Technologies Inc. on NASDAQ.
About Powerwave Technologies
Powerwave Technologies Inc. (NASDAQ: PWAV) filed for Chapter 11
bankruptcy (Bankr. D. Del. Case No. 13-10134) on Jan. 28, 2013.
Powerwave Technologies, headquartered in Santa Ana, Cal., is a
global supplier of end-to-end wireless solutions for wireless
communications networks. The Company has historically sold the
majority of its product solutions to the commercial wireless
infrastructure industry.
The Company's balance sheet at Sept. 30, 2012, showed $213.45
million in total assets, $396.05 million in total liabilities and
a $182.59 million total shareholders' deficit.
Aside from a $35 million secured debt to P-Wave Holdings LLC, the
Debtor owes $150 million in principal under 3.875% convertible
subordinated notes and $106 million in principal under 2.5%
convertible senior subordinated notes where Deutsche Bank Trust
Company Americas is the indenture trustee. In addition, as of the
Petition Date, the Debtor estimates that between $15 and $25
million is outstanding to its vendors.
The Debtor is represented by attorneys at Proskauer Rose LLP and
Potter Anderson & Corroon LLP.
PURIFIED RENEWABLE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Purified Renewable Energy, LLC
P.O. Box 190
Buffalo Lake, MN 55314
Bankruptcy Case No.: 13-41446
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
District of Minnesota (Minneapolis)
Judge: Dennis D. O'Brien
Debtor's Counsel: Clinton E. Cutler, Esq.
FREDRIKSON & BYRON, P.A.
200 South Sixth Street, Suite 4000
Minneapolis, MN 55402
Tel: (612) 492-7070
E-mail: ccutler@fredlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/mnb13-41446.pdf
The petition was signed by Kyle Peik, vice president and chief
production manager.
PVR PARTNERS: S&P Lowers CCR to 'B+' and Affirms Negative Outlook
------------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on PVR Partners L.P. to 'B+' from 'BB-' and affirmed
the negative outlook. At the same time, S&P lowered the
partnership's senior unsecured rating to 'B-' from 'B' and left
unchanged the partnership's senior unsecured recovery rating of
'6', which indicates that unsecured lenders can expect negligible
(0% to 10%) recovery if a payment default occurs. As of Dec. 31,
2012, PVR had total balance sheet debt of about $1.5 billion.
"We lowered our corporate credit ratings on PVR due to challenging
market conditions across all three of its operating segments,
which have resulted in weakening financial measures," said
Standard & Poor's credit analyst Nora Pickens.
Most notably, the currently low natural gas prices have led to
drilling slowdowns and reduced throughput margins at PVR's
Marcellus Shale region operations. Although major growth projects
such as construction of the Wyoming Pipeline were completed on
schedule and have notably increased PVR's take-or-pay cash flow
profile, S&P expects overall volumes to remain below its original
expectations. In terms of PVR's coal-management business, S&P
believes natural gas substitution and warm weather trends will
continue to lessen demand for coal over the next 12 to 24 months.
As such, S&P estimates that coal tonnage will decline 25% relative
to last year. Finally, PVR's midstream segment has underperformed
due to low natural gas liquids (NGL) prices, which S&P expects to
continue for the rest of the year. Therefore, S&P is forecasting
high debt to EBITDA of 5x and distribution coverage just under 1x
in 2013. S&P believes, however, that PVR's operations have
stabilized to some degree and the risk for substantial downside is
limited.
PVR's ratings reflect a "weak" business risk profile and an
"aggressive" financial risk profile as S&P's criteria define them.
Factors that influence the rating include high financial leverage,
an aggressive growth strategy, and commodity price exposure
relating primarily to its Mid-Continent midstream segment.
Increasing fee-based cash flows and adequate liquidity partially
offset the weaknesses.
The negative outlook reflects S&P's view that weak market
conditions may continue to pressure PVR's cash flow and lead to
financial measures inconsistent with the 'B+' rating. S&P could
lower the rating if the company sustains debt to EBITDA rises
above 5x, which could occur from a confluence of factors such as
throughput declines across PVR's midstream operations, lower-than-
expected coal royalty revenues, or falling NGL prices. S&P could
revise the outlook to stable if it gains greater visibility on the
partnership's ability to reduce financial leverage to the 4x to
4.5x range over the next 12 to 24 months.
R.E. LOANS: Dallas District Court Rules on Investors' Claims
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that according to an opinion last week by Chief U.S.
District Judge Sidney A. Fitzwater in Dallas, out of one
transaction, some claims belong to individual creditors and some
don't.
The report relates the case involved an investment trust where
investors initially had the status of equity owners and had rights
to control corporate affairs. There was a restructuring where the
investors were turned into creditors, with a bank receiving liens
ahead of their interests. Following the investment fund's
bankruptcy, investors filed a class suit which the bankruptcy
court halted, concluding that the claims all belonged to the
bankrupt.
According to the report, Judge Fitzwater reversed, finding that
some claims belong to investors alone. With regard to a claim
based on a loan made by the bank defendant, Judge Fitzwater ruled
that "aiding and abetting breach of fiduciary duty" claims belong
to the bankrupt alone. On the other hand, he held aiding and
abetting claims related to a companion exchange offer belonged to
investors alone, as did claims for securities law violations.
The case is Wells Fargo Capital Finance LLC v. Noble (In re R.E.
Loans LLC), 12-cv-03513, U.S. District Court, Northern District
Texas (Dallas).
About R.E. Loans
R.E. Loans, LLC, was, for many years, in the business of providing
financing to home builders and developers of real property. R.E.
Future LLC and Capital Salvage own the real property obtained
following foreclosure proceedings initiated by R.E. Loans against
its borrowers. R.E. Loans is the sole shareholder of Capital
Salvage and the sole member of R.E. Future. B-4 Partners LLC is
the sole member of R.E. Loans. As a result of the multiple
defaults by R.E. Loans' borrowers, R.E. Loans has transitioned
from being a lender to becoming a property management company.
Lafayette, California-based R.E. Loans, R.E. Future and Capital
Salvage filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case
Nos. 11-35865, 11-35868 and 11-35869) on Sept. 13, 2011. Judge
Barbara J. Houser presides over the case. Stutman, Treister &
Glatt Professional Corporation, in Los Angeles, and Gardere, Wynne
Sewell LLP, in Dallas, represent the Debtors as counsel. James A.
Weissenborn at Mackinac serves as R.E. Loans' chief restructuring
officer. The Debtors tapped Hines Smith Carder as their
litigation and outside general counsel. The Debtors tapped
Alixpartners, LLP as noticing agent, and Latham & Watkins LLP as
special counsel in real estate matters. R.E. Loans disclosed
$713.6 million in assets and $886.0 million in liabilities as of
the Chapter 11 filing.
Akin Gump Strauss Hauer & Feld LLP, in Dallas, represents
the Official Committee of Note Holders as counsel.
READER'S DIGEST: Sale Approval Sought
-------------------------------------
BankruptcyData reported that RDA Holding Co. filed with the U.S.
Bankruptcy Court a motion for an order (A)approving the sale of
Reader's Digest's indirect interest in the equity securities of
Selection du Reader's Digest S.A. (RDA France) with Cil
Inversiones, S.L., as purchaser; Sociedad Ano nima de Promocion y
Ediciones (SAPE), as purchaser parent and Uitgeversmaatschappij
The Reader's Digest B.V., as licensor and (B) authorizing the
private sale of Reader's Digest's direct interest in (i) the
equity securities of Oy Valitut Palat - Reader's Digest ab (RDA
Finland) and Reader's Digest AB (Aktiebolag) pursuant to the terms
set forth in the SAPE purchase agreement.
Under the agreement, the Debtors will sell the assets for $5.8
million and royalty income, the report related.
The Court scheduled an April 11, 2013 hearing on the motion.
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: Can Hire Ordinary Course Professionals
-------------------------------------------------------
The Bankruptcy Court has authorized RDA Holding Co. and its
affiliates to hire ordinary course professionals, nunc pro tunc to
the Petition Date.
The Court directs that the Ordinary Course Professional's total
compensation and reimbursements will not exceed $50,000 for each
month starting from the first full month following the
Commencement Date. In the event the Professional seeks more than
the Monthly Cap, the Professional will file a fee application for
the full amount of its fees and expenses for any month where the
Professional's fees and disbursements exceeded the Monthly Cap.
In addition, payment to any one Ordinary Course Professional will
not exceed $500,000 for the period in which this chapter 11 case
is pending. In the event that a Professional's fees and expenses
exceed $500,000, the Professional will be required to file a
separate retention application to be retained as a professional
pursuant to sections 327 or 328 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.
READER'S DIGEST: Form of Adequate Assurance for Utilities Okayed
----------------------------------------------------------------
Judge Robert D. Drain has authorized RDA Holding Co. and its
affiliates has approved the proposed form of adequate assurance of
payment to utilities and established procedures for resolving
objections by utility companies. In addition, Judge Drain
prohibits utilities from altering, refusing, or discontinuing
service to the Debtors.
As adequate assurance for the payment of Utility Services, the
Debtors will deposit cash in an amount equal to $110,000 into a
segregated account at JP Morgan Chase Bank, N.A. for the benefit
of all Utility Companies.
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.
RG STEEL: Wells Fargo Says Creditors' Suit Doesn't Hold Up
----------------------------------------------------------
Jamie Santo of BankruptcyLaw360 reported that Wells Fargo Capital
Finance LLC knocked RG Steel LLC's unsecured creditors Friday for
their renewed bid to sue Ira Rennert, the billionaire owner and
chairman of the defunct steelmaker's parent The Renco Group Inc.,
saying the new suit asserts baseless accusations against the bank.
The report related that on Feb. 22, RG Steel's official committee
of unsecured creditors asked the Delaware bankruptcy court to rule
it had standing to file a revised complaint alleging Rennert
breached his fiduciary duties as the steelmaker descended into
Chapter 11.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owns Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012, to pursue a sale of the business. The
bankruptcy was precipitated by liquidity shortfall and a dispute
with Mountain State Carbon, LLC, and a Severstal affiliate, that
restricted the shipment of coke used in the steel production
process.
The Debtors estimated assets and debts in excess of $1 billion as
of the Chapter 11 filing. The Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors.
Conway MacKenzie, Inc., serves as the Debtors' financial advisor
and The Seaport Group serves as lead investment banker. Donald
MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson
Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
An official committee of unsecured creditors has been appointed in
the case. Kramer Levin Naftalis & Frankel LLP represents the
Committee. Huron Consulting Services LLC serves as its financial
advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million.
RHYTHM AND HUES: Committee Taps Stutman Treister as Counsel
-----------------------------------------------------------
The Official Committee of Unsecured Creditors of Rhythm and Hues,
Inc., asks the U.S. Bankruptcy Court for permission to retain
Stutman, Treister & Glatt Professional Corporation as counsel,
effective as of March 4, 2013.
Stutman Treister will represent only the Committee, and not any of
its respective individual members or any other creditors of the
Debtor.
The firm's Gary E. Klausner attests the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.
The rates of Stutman Treister professionals are:
Attorneys: $285 to $1,045 per hour
Paralegals: $240 per hour
Law Clerks: $250 to $270 per hour
Rates of the Professionals Expected to be Most Active:
Gary E. Klausner: $850 per hour
H. Alexander Fisch: $535 per hour
Danielle A. Pham: $315 per hour
About Rhythm and Hues
Rhythm and Hues, Inc., aka Rhythm and Hues Studios Inc., filed its
Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-13775) in Los
Angeles on Feb. 13, 2013, estimating assets ranging from $10
million to $50 million and liabilities ranging from $50 million to
$100 million. Judge Neil W. Bason oversees the case. Brian L.
Davidoff, Esq., C. John M Melissinos, Esq., and Claire E. Shin,
Esq., at Greenberg Glusker, serve as the Debtor's counsel.
Houlihan Lokey Capital Inc., serves as investment banker.
The petition was signed by John Patrick Hughes, president and CFO.
R&H provided visual effects and animation for more than 150
feature films and has received Academy Awards for Babe and the
Golden Compass, an Academy Award nomination for The Chronicles of
Narnia and Life of Pi. R&H owned a 135,000 square-foot facility
in El Segundo, California, and had more than 460 employees.
Key clients Universal City Studios LLC and Twentieth Century Fox,
a division of Twentieth Century Fox Film Corporation, provided DIP
financing. They are represented by Jones Day's Richard L. Wynne,
Esq., and Lori Sinanyan, Esq.
ROSETTA GENOMICS: Incurs $10.4 Million Net Loss in 2012
-------------------------------------------------------
Rosetta Genomics Ltd. filed with the U.S. Securities and Exchange
Commission its annual report on Form 20-F disclosing a net loss of
US$10.45 million on US$201,000 of revenue for the year ended
Dec. 31, 2012, as compared with a net loss of US$8.83 million on
US$103,000 of revenue during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed US$32.53
million in total assets, US$1.63 million in total liabilities and
US$30.90 million in total shareholders' equity.
Bankruptcy Warning
"We will require substantial additional funding and expect to
augment our cash balance through financing transactions, including
the issuance of debt or equity securities and further strategic
collaborations. On December 7, 2012, we filed a shelf
registration statement on Form F-3 with the SEC for the issuance
of ordinary shares, various series of debt securities and/or
warrants to purchase any of such securities, either individually
or in units, with a total value of up to $75 million, from time to
time at prices and on terms to be determined at the time of such
offerings. The filing was declared effective on December 19,
2012. However there can be no assurance that we will be able to
obtain adequate levels of additional funding on favorable terms,
if at all. If adequate funds are not available, we may be
required to:
* delay, reduce the scope of or eliminate certain research and
development programs;
* obtain funds through arrangements with collaborators or
others on terms unfavorable to us or that may require us to
relinquish rights to certain technologies or products that we
might otherwise seek to develop or commercialize
independently;
* monetizing certain of our assets;
* pursue merger or acquisition strategies; or
* seek protection under the bankruptcy laws of Israel and the
United States."
A copy of the Form 20-F is available for free at:
http://is.gd/VzqvoU
Sales Agreement with Cantor
On March 22, 2013, Rosetta entered into a Controlled Equity
OfferingSM Sales Agreement with Cantor Fitzgerald & Co., as sales
agent, pursuant to which Rosetta may offer and sell, from time to
time, through Cantor its ordinary shares, par value NIS 0.6 per
share, having an aggregate offering price of up to $5,900,000.
Rosetta intends to use the net proceeds from the offering, if any,
for its operations and for other general corporate purposes,
including, but not limited to, repayment or refinancing of future
indebtedness or other future corporate borrowings, working
capital, intellectual property protection and enforcement, capital
expenditures, investments, acquisitions or collaborations,
research and development and product development.
Rosetta is not obligated to sell any Shares under the Agreement.
Subject to the terms and conditions of the Agreement, Cantor will
use commercially reasonable efforts, consistent with its normal
trading and sales practices and applicable state and federal law,
rules and regulations and the rules of The NASDAQ Capital Market,
to sell Shares from time to time based upon Rosetta's
instructions, including any price, time or size limits or other
customary parameters or conditions Rosetta may impose.
Under the Agreement, Cantor may sell Shares by any method deemed
to be an "at-the-market" offering as defined in Rule 415
promulgated under the Securities Act of 1933, as amended,
including sales made directly on The NASDAQ Capital Market, on any
other existing trading market for the Shares or to or through a
market maker. In addition, pursuant to the terms and conditions
of the Agreement and subject to the instructions of Rosetta,
Cantor may sell Shares by any other method permitted by law,
including in privately negotiated transactions.
The Agreement will terminate upon the earlier of (i) the sale of
Shares under the Agreement having an aggregate offering price of
$5,900,000 and (ii) the termination of the Agreement by Cantor or
Rosetta. The Agreement may be terminated by Cantor or Rosetta at
any time upon 10 days' notice to the other party, or by Cantor at
any time in certain circumstances, including the occurrence of a
material adverse change in Rosetta.
Rosetta will pay Cantor a commission of 3.0% of the aggregate
gross proceeds from each sale of Shares and has agreed to provide
Cantor with customary indemnification and contribution rights.
Rosetta has also agreed to reimburse Cantor for legal fees and
disbursements, not to exceed $50,000 in the aggregate, in
connection with entering into the Agreement.
About Rosetta
Based in Rehovot, Israel, Rosetta Genomics Ltd. is seeking to
develop and commercialize new diagnostic tests based on a recently
discovered group of genes known as microRNAs. MicroRNAs are
naturally expressed, or produced, using instructions encoded in
DNA and are believed to play an important role in normal function
and in various pathologies. The Company has established a CLIA-
certified laboratory in Philadelphia, which enables the Company to
develop, validate and commercialize its own diagnostic tests
applying its microRNA technology.
ROTHSTEIN ROSENFELDT: Trustee Wants Creditors' Counsel Fee Deals
----------------------------------------------------------------
Carolina Bolado of BankruptcyLaw360 reported that the trustee
overseeing the liquidation of Ponzi schemer Scott Rothstein's firm
on Thursday asked a bankruptcy judge to force Conrad & Scherer
LLP, the firm representing investors suing TD Bank NA over its
alleged role in the scheme, to disclose its retainer agreements
with clients.
The report said Rothstein Rosenfeldt Adler PA bankruptcy trustee
Herbert Stettin asked U.S. Bankruptcy Judge Raymond Ray to compel
the investors' counsel to comply with a previous order requiring
the firm to make its retainer agreements with creditors available
to the trustee for copying.
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.
RUN-SER DEVELEPMENT: Case Summary & 6 Unsecured Creditors
---------------------------------------------------------
Debtor: Run-Ser Develepment LLC
P.O. Box 1417
Hixson, TN 37343
Bankruptcy Case No.: 13-11497
Chapter 11 Petition Date: March 27, 2013
Court: U.S. Bankruptcy Court
Eastern District of Tennessee (Chattanooga)
Judge: John C. Cook
Debtor's Counsel: David J. Fulton, Esq.
SCARBOROUGH, FULTON & GLASS
701 Market Street, Suite 1000
Chattanooga, TN 37402
Tel: (423) 648-1880
Fax: (423) 648-1881
E-mail: djf@sfglegal.com
Scheduled Assets: $3,065,000
Scheduled Liabilities: $4,544,983
A copy of the Company's list of its six largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/tneb13-11497.pdf
The petition was signed by Vitaly Serkalow, president.
SAHGA GROUP: Case Summary & 4 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Sahga Group L.P.
8841 Foothill Blvd
Rancho Cucamonga, CA 91730
Bankruptcy Case No.: 13-15564
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Central District Of California (Riverside)
Judge: Scott C. Clarkson
Debtor's Counsel: Stephen R Wade, Esq.
THE LAW OFFICES OF STEPHEN R WADE
350 W Fourth St.
Claremont, CA 91711
Tel: (909) 985-6500
Fax: (909) 399-9900
E-mail: laurel@srwadelaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of four unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/cacb13-15564.pdf
The petition was signed by Gilbert Rodriguez, Jr., secretary.
SALLY BEAUTY: S&P Revises Outlook to Stable & Affirms 'BB+' CCR
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Denton,
Texas-based Sally Beauty Holdings Inc. and Sally Holdings LLC to
stable from positive. At the same time, S&P affirmed all other
ratings on both entities, including the 'BB+' corporate credit
ratings.
S&P also affirmed its 'BB+' issue-level rating on Sally Holdings
LLC and Sally Capital Inc.'s senior unsecured notes. The recovery
rating on this debt remains a '3', indicating S&P's expectation of
meaningful (50% to 70%) recovery to noteholders in the event of a
payment default.
"The ratings on Sally Beauty Holdings and its indirect wholly
owned subsidiaries Sally Holdings and Sally Capital reflect its
'satisfactory' business risk profile and 'significant' financial
risk profile," said Standard & Poor's credit analyst Kristina
Koltunicki.
S&P assess the company's business risk profile as satisfactory,
given Sally's leading position in the growing, yet highly
discretionary and fragmented beauty supply industry, stable
historical operating performance, and highly concentrated supplier
base. Sally competes with a wide range of participants in the
beauty products sector, including other specialty beauty supply
stores, salons, mass merchants, drug stores, and supermarkets.
S&P believes Sally's broad range of merchandise, including its
higher margin, exclusive-label products, provides a unique value
proposition to consumers, which has aided the company's strong
historical sales growth. Sally has also been very successful in
integrating acquisitions over the past 10 years. S&P anticipates
that the company will continue to make small acquisitions,
primarily funded with free cash flow, over the next few years, to
further extend its geographic presence and fuel growth.
The outlook is stable. S&P expects credit protection measures to
improve over the next 12 months, albeit at a slower pace than S&P
previously forecast due to a return to more normalized levels of
sales growth and a more aggressive stance on share repurchases.
S&P believes that revenues will continue to increase due to a
combination of new store growth and positive same-store sales,
which should assist in margin accretion because the company will
be able to better leverage its expenses.
S&P could lower the ratings if credit protection measures weaken,
due to more aggressive financial policies, including a debt-
financed share repurchase. Under this scenario, debt would need
to increase by approximately $600 million for leverage to increase
to the high-3.0 area.
An upgrade is unlikely over the next year, because S&P currently
assess the company's financial risk profile as significant, which
incorporates its view that financial policies will remain
aggressive over the next two years. S&P could raise the ratings
if Sally were to improve debt leverage and sustain it in the mid-
2.0x area, which could trigger a reassessment of the financial
risk profile to intermediate.
SAMSON MANUFACTURING: Case Summary & Creditors List
---------------------------------------------------
Debtor: Samson Manufacturing Corporation
4 Forge Street
Keene, NH 03431
Bankruptcy Case No.: 13-10735
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
District of New Hampshire (Manchester)
Judge: Bruce A. Harwood
Debtor's Counsel: Peter N. Tamposi, Esq.
THE TAMPOSI LAW GROUP, P.C.
159 Main Street
Nashua, NH 03060
Tel: (603) 204-5513
E-mail: peter@thetamposilawgroup.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/nhb13-10735.pdf
The petition was signed by Scott Samson, president.
SAN DIEGO HOSPICE: Sued for Mass Firings Without Notice
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that San Diego Hospice & Palliative Care Corp. was the
target of a class lawsuit filed at the end of last week on behalf
of 360 workers who were fired without 60 days' notice required by
federal and state labor law.
About San Diego Hospice
San Diego Hospice & Palliative Care Corporation filed a Chapter 11
petition (Bankr. S.D. Calif. Case No. 13-01179) in San Diego on
Feb. 4, 2013. The Debtor is the operator of the San Diego Hospice
and The Institute for Palliative Medicine, one of the largest
community-owned, not-for-profit hospices in the country.
The Debtor scheduled $20,369,007 in total assets and $14,888,058
in total liabilities.
Even before the bankruptcy filing, the Debtor has been under a
federal investigation, focusing whether it allowed patients to
stay in the program even when their diagnosis changed. The Debtor
said that it will meet with government agencies to address their
concerns, explore partnerships with other health care
organizations, and work to restructure and resize San Diego
Hospice. The Debtor said it has encouraged Scripps Health, the
region's largest provider of health care services, to enter the
hospice business.
Procopio, Cory, Hargreaves & Savitch LLP serves as counsel to the
Debtor.
SEAN DUNNE: Irish Developer Files for Chapter 7 in Connecticut
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Irish real estate developer Sean Dunne filed a
liquidating Chapter 7 bankruptcy petition (Bankr. D. Conn. Case
No. 13-50484) on March 30 in Bridgeport, Connecticut. Mr. Dunne
says he now lives and works in Connecticut.
In a letter to the Irish Independent newspaper, Mr. Dunne said he
filed for bankruptcy in the U.S. because Ulster Bank was applying
to an Irish court for permission to commence bankruptcy
proceedings there. In the letter to the newspaper, Mr. Dunne
said, "I have no assets." He also said he hadn't planned on
filing bankruptcy.
Mr. Dunne filed no papers along with his petition other than a
list of creditors, without amounts owing, and a statement that he
received required credit counseling. Mr. Dunne's asset are less
than $10 million while debt exceeds $500 million, according to the
petition.
Mr. Rochelle notes that creditors have the right to challenge Mr.
Dunne's bankruptcy in the U.S. They could seek dismissal if they
believe he does not actually reside in the U.S. Or, they could
ask the U.S. court to abstain on a showing bankruptcy is better
conducted in Ireland. Abstention is short of dismissal. It means
not proceeding with the bankruptcy in the U.S.
SEMINOLE TRIBE: Fitch Affirms 'BB+' Issuer Default Rating
---------------------------------------------------------
Fitch Ratings assigns a 'BBB-' rating to Seminole Tribe of
Florida's proposed $750 million term loan. Fitch also affirms
STOF's Issuer Default Rating (IDR) at 'BB+', the gaming enterprise
revenue bonds at 'BBB-' and special obligation bonds at 'BB+'.
Fitch revises the Rating Outlook to Positive from Stable. See the
full list of rating actions at the end of this release.
The proposed term loan will be pari passu with STOF's existing
term loan and gaming enterprise revenue bonds and will be secured
by a revenue pledge of STOF's gaming operations, which include six
major casinos in the state of Florida with nearly 13,000 slot
machines and approximately 340 table games.
The proposed term loan will amortize at a rate of 7% per year with
a balloon payment in 2020. Proceeds along with cash on hand will
be used to repay $794 million outstanding on the existing term
loan due to mature in 2014. Preliminary financial maintenance
covenants include a maximum net leverage test of 2.5x and minimum
interest coverage of 3.0x. The term loan will come with an
accordion option permitting STOF to borrow up to 2x leverage or
$500 million, whichever is greater.
KEY RATING DRIVERS
The Rating Outlook revision to Positive on STOF's IDR is supported
by Fitch's increased comfort with the tribe's governance and
fiscal management since Fitch downgraded STOF out of investment
grade in 2010 following a Notice of Violation (NOV) from National
Indian Gaming Commission (NIGC). Since the NOV the tribe took
measures to correct the violations related to the NOV.
In the May 2011 tribal council elections, three of the five
incumbents were not reelected, with a fourth incumbent resigning
prior to the elections. Two of the prior council members were
involved in actions that led to the NOV.
The newly elected council pledged to increase tribal reserve
levels to equal two months of governmental expenditures (or about
three times historical levels). Reserves reached target level in
2012 and are budgeted to grow by additional 30% by fiscal year-end
2013 (ends September 30). In January 2013, STOF's council passed a
resolution eliminating per capita payments to minors born after
the resolution effective date, which is pending an approval from
the Bureau of Indian Affairs. Nearly 60% of the governmental
budget goes to pay per capita payments to tribal members and
nearly 50% of the tribe's population is under 18.
As a result of the measure, STOF estimates that aggregate per
capita payments will be reduced by approximately 15% and 30% in
years five and 10 of the implementation, respectively, compared to
per capita payments at such time if the resolution was not passed.
Relative to present per capita spending levels the estimated
reduction is 3% after five years and 7% after 10. The full
realized savings resulting from the resolution will materialize
after 18 years following the implementation.
Also reflected in the Outlook revision is the extension of the
gaming division management's employment contracts (CFO through
2015 and CEO through 2018) and the improved maturity profile with
the refinancing of the term loan that was due to mature in 2014.
RATING SENSITIVITIES
Fitch believes that STOF's operating profile and credit metrics
are consistent with 'BBB-' IDR, and a further track record of
fiscal prudence by the tribe may result in an upgrade of the IDR
to 'BBB-' within the next 12-24 months. Specifically, an
investment grade IDR can be supported by STOF's:
-- SOLID COMPETITIVE POSITION:
In the state of Florida with a monopoly in Tampa (nearly half of
EBITDA) and strong position relative to the pari-mutuels in
southeast Florida, where STOF's three casinos benefit from a lower
tax structure as well as ability to offer tables games and allow
smoking. STOF's smaller casinos in Immokalee and Brighton
(together accounting for 7% of EBITDA), as in in Tampa, have no
competition.
-- STRONG CREDIT METRICS:
Relative to industry peers (commercial and tribal), STOF's
leverage through the gaming debt is 1.4x, and it is 1.9x if the
special obligation bonds on the tribal side are included. Leverage
metrics should improve in the near term as much of the debt in
STOF's capital structure amortizes rapidly. STOF may look to
borrow to fund expansion capex in the medium term as Fitch
believes some of its properties are capacity constrained; however,
leverage on the gaming side should remain at or below 2x. Fitch
calculates total debt service coverage by EBITDA at 4.2x and
STOF's covenant coverage, which is based on maximum annual debt
service (MADS) and spreads the term loan balloon payment over six
years, is 3.3x for period ending Dec. 31, 2012.
-- SIGNIFICANT OFFSETS TO REGULATORY RISK:
Since STOF's gaming compact allows STOF to suspend compact revenue
share payments, partially or completely, in the event the state
legislature authorizes additional commercial gaming in the state
or allows STOF's table games authorization to expire in 2015.
Authorization of new facilities in Broward and/or Miami-Dade
Counties or expiration of STOF's ability to offer table games
would permit STOF to stop paying compact fees based on revenues
generated at its Broward County facilities (about 50% of
revenues). Expansion of gaming outside the two counties mentioned
above would allow STOF to suspend compact revenue share payments
completely.
The next event Fitch will be monitoring closely is the May 2013
tribal council election, in which three of the five council seats
will be up for re-election. A re-election of the current council
members, or Fitch gaining comfort that the newly elected members
similarly espouse fiscal prudence, would be a positive
consideration for an upgrade.
Continued buildup of reserves at the tribal level and/or at the
gaming level would also be viewed positively. However, an upgrade
would not be precluded if reserves are maintained at existing
levels should STOF spend incremental accumulated surpluses on
growth capex on the gaming side or more critical projects on the
tribal side.
On the operating side, build-out of slot operations at Dania Jai
Alai (Dania) could pressure STOF's slot revenues at Seminole
Hollywood Classic and to a lesser extent at Hard Rock Hollywood.
Dania is being sold by Boyd Gaming to a private investor group for
$65.5 million. The potential for additional competitive pressure
is manageable in context of the 'BB+' IDR and can potentially be
accommodated within the context of 'BBB-' depending on the general
operating environment and the scope of the project.
STOF's ability to operate table games expires in July 2015. A
failure to extend table games past 2015 would be a negative as
table games account for 17% of the gaming division's revenues and
14% of the EBITDA. As mentioned above, expiration of table games
would be offset by reduced compact revenue share payments (STOF's
revenue share percentage is effectively about 12%).
Over the next 12-24 months, worse than expected downturn in the
operating environment and/or regulatory changes that would add
significant commercial gaming capacity in the state of Florida may
prevent or delay an upgrade. There is, however, cushion in the
'BB+' IDR to withstand these potential pressures.
Regulatory Change Considerations
No major legislative action is anticipated in 2013, as the Florida
Legislature set up a Senate gaming committee to conduct a
comprehensive study of gaming in the state by the 2014 legislative
session. The study will consider the impacts of potential gaming
expansion. The committee did approve a ban on Internet cafes,
which if passed in 2013 would be positive for STOF's gaming
operations.
Fitch believes there is a low likelihood that the integrated
resort legislation passes in the near term, since it faces heavy
opposition from STOF, the pari-mutuels, the Orlando theme-park
companies and other interest groups. If it eventually passes,
Fitch expects the impact on STOF's financial profile will be
manageable. Per the compact agreement, STOF would be able to stop
making the compact fee payments from its Broward County casinos
(Hollywood Hard Rock, Seminole Hollywood Classic and Seminole
Coconut Creek) which account for about half of the gaming
division's revenues. Other facilities in Immokalee, Tampa and
Brighton would not be directly impacted.
In 2011, bills were filed proposing three integrated casino
resorts in Broward and Miami-Dade Counties. The minimum investment
was set at $2 billion and the tax rate was initially proposed at
10%. The bills were pulled in the 2012 session due to lack of
support. Fitch expects similar proposals in the future, since the
initiative is heavily lobbied for by commercial operators,
especially Genting Malaysia Berhad, which has purchased
substantial prime land in Miami for a mixed-use development.
Operating Profile
The tribe operates six major casinos throughout the state of
Florida, including two flagship Hard Rock branded properties in
Tampa and Hollywood. In 2012 STOF completed major expansions at
Hard Rock Tampa, Seminole Coconut Creek and Seminole Hollywood
Classic. Per the 2010 compact with the state, the tribe has
exclusivity to Class III slots outside of Miami-Dade and Broward
Counties through 2030. Table game exclusivity applies to the
entire state but the tribe's authorization and exclusivity to
operate table games expires in 2015 unless renewed.
STOF's gaming division operating performance was resilient through
the 2008-2009 recession and the period of heavy expansion of slot
machines at the pari-mutuel facilities in Miami-Dade and Broward
Counties. The resiliency can be largely attributed to STOF's
strong market position and the conversion to Class III slots and
addition of table games starting 2008.
Revenues and EBITDA were up 4% and 2%, respectively, in fiscal
2012 while revenue and EBITDA in the quarter ending Dec. 31, 2012
were each up 5% and 3%. Management mentioned that January in 2013
was strong while February was softer. The stated reasons for the
softness are common amongst regional gaming operators and include
higher gas prices and increased payroll tax.
Fitch expects revenue to be up slightly in 2013 as further ramp-up
of expansion projects completed in 2012 offsets Fitch's lackluster
outlook for the regional economy. Reported EBITDA will increase in
line with revenues but operating cash flow will be pressured by an
increase in compact payments that went into effect July 2012 (from
$150 million to the higher of $233 million or 12% of gaming
revenues). STOF uses the straight line accounting method to
expense the $1 billion it guaranteed the state in compact revenue
share payments over the first five years of the agreement ($200
million per year) so there will be little to no impact on the
reported EBITDA.
Cash flow available for tribal distributions should remain
relatively constant as gaming division annual debt service may
decline by nearly $60 million by October 2013. This includes
reduced amortization on the new term loans, maturity of series
2005A notes and potential refinancing of the 2010 notes.
STOF's gaming division added to an already strong management team
in 2012 with the hire of Larry Mullin as COO. Mullin's previous
position was as a CEO of Echo Entertainment, a major casino
operator in Australia, and prior to that Mullin managed Borgata in
Atlantic City. The hiring of Mullin should bolster STOF gaming
division's marketing efforts and his employment contract runs
through 2016. The gaming division made other high-profile hires
recently including SVP of IT, SVP of HR and SVP of Slot
Operations.
Liquidity
As part of the term loan refinancing STOF gaming division plans to
move $97 million of restricted cash now in a debt service fund to
the division's unrestricted cash. Another $61 million of
restricted cash will be used to repay a portion of the 2007 term
loan and to cover transactions costs associated with the
refinancing. STOF does not maintain a revolver and historically
maintained limited cash at the enterprise level in excess of what
is required for day-to-day operations. Therefore, Fitch views the
added liquidity positively as it cushions the tribe against the
increased compact revenue share payments while debt service
reduction discussed above materializes over the next six months
and expansion projects completed in 2012 continue to ramp up.
The tribe now has sufficient reserves to operate for two months
without receiving any revenues including distributions from the
gaming enterprises and expects to grow the reserve further.
Besides its gaming division, the tribe also owns Hard Rock
International, which paid dividends to the tribe over the past
three years.
Pro forma for the term loan issuance, the maturity profile is
favorable. The next bullet maturity will be in 2017, when $367
million revenue notes series 2010 come due. These notes trade at a
significant premium and could be called in October 2013, when they
become callable.
Transaction Specific Ratings
The one notch differential on the gaming division debt (includes
the bonds and the term loan) relative to the IDR and the
investment grade rating reflects:
-- The additional debt incurrence test in the 2005 indenture of
3.5x leverage for the senior lien gaming division debt (4.5x
for total gaming division debt) and gaming division MADS
coverage by EBITDA test of 3.0x. The new term loan is expected
to be more stringent with a 2.5x maximum net leverage
maintenance test;
-- The gaming division seniority in the casino revenue trustee
guided waterfall relative to the special obligations bonds;
-- The gaming division debt holders' ability to shut off the flow
of funds at the gaming division level before distributions
into the Governmental Distribution Fund are made if MADS
coverage by EBITDA goes below 2x. Money retained in the
waterfall would go towards redeeming the gaming revenue debt
with some carveouts for payments to the tribe to maintain
critical governmental operations.
The special obligation bonds only have recourse to the funds
available in the Governmental Distribution Fund so there is risk
that the debt service on these bonds will not get paid if MADS
coverage goes below 2x on the gaming side. The special obligation
bondholders do not have recourse to the tribe outside of the cash
in the Governmental Distribution Fund, which receives the flow of
funds monies through a trustee after the gaming division debt is
paid. Money is released to the tribe from the Governmental
Distribution Fund once the debt service on the special obligation
bonds is paid.
The special obligation bonds' indenture has an additional debt
incurrence covenant stipulating that pari passu debt cannot exceed
15% of Available Revenues.
Fitch affirms these ratings:
Seminole Tribe of Florida
-- IDR at 'BB+'; Outlook to Positive from Stable);
-- $367 million gaming division bonds, series 2010A&B at 'BBB-';
-- $412 million gaming division bonds, series 2005A&B at 'BBB-';
-- $889 million term loan at 'BBB-';
-- $435 million special obligation bonds, series at 'BB+';
-- $94 million special obligation bonds, series 2008A at 'BB+'.
SHEA HOMES: S&P Affirms 'B' Rating on $750MM Sr. Secured Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its recovery rating on
Shea Homes L.P.'s $750 million senior secured notes to '3' from
'4', indicating S&P's expectation for meaningful (50%-70%)
recovery in the event of default. The 'B' issue rating on the
senior secured notes remains unchanged.
Walnut, Calif.-based Shea is a privately held company that ranks
among the nation's 20 largest homebuilders. The company is very
closely held by J.F. Shea Co. Inc. (a general construction firm
and Shea's general partner through holding company J.F. Shea L.P.)
and members of the Shea family, which have a 79% partnership
interest in Shea.
RATINGS LIST
RATINGS UNCHANGED
Shea Homes L.P.
Shea Homes Funding Corp.
Corporate credit rating B/Stable/--
RECOVERY RATING REVISED
Shea Homes L.P.
Shea Homes Funding Corp.
To From
$750 mil. sr. secured notes B
Recovery Rating 3 4
SIEGMUND STRAUSS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Siegmund Strauss, Inc.
110 East 49th Street
P.O. Box 889
Bronx, NY 10451
Bankruptcy Case No.: 13-10887
Chapter 11 Petition Date: March 25, 2013
Court: U.S. Bankruptcy Court
Southern District of New York (Manhattan)
Debtor's Counsel: Marc E. Richards, Esq.
BLANK ROME, LLP
The Chrysler Building
405 Lexington Avenue
New York, NY 10174-0208
Tel: (212) 885-5000
Fax: (212) 885-5003
E-mail: mrichards@blankrome.com
Scheduled Assets: $232,292
Scheduled Liabilities: $1,067,847
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/nysb13-10887.pdf
The petition was signed by Stanley Mayer, president.
SIMON WORLDWIDE: Inks LLC Operating Agreement of Three Lions
------------------------------------------------------------
Simon Worldwide, Inc., together with Richard Beckman, Joel Katz
and OA3, LLC, entered into a Limited Liability Company Operating
Agreement of Three Lions Entertainment, LLC, on March 17, 2013.
Pursuant to the Operating Agreement, on the Effective Date the
Company made an initial capital contribution of $3,150,000 with
respect to membership units representing 60% of the voting power
of Three Lions. The membership units received by the Company
represent a 60% economic interest in the economic returns of Three
Lions, including certain preferences with respect to common
holders on operating returns and on a liquidation or sale of Three
Lions, in each case to the extent that the Company's capital
contributions have not yet been recouped.
The Company has the ability to, but is not required to, make
additional capital contributions of $1,850,000 and $3,500,000 not
later than 45 and 120 days following the Effective Date,
respectively. If the Company does not make those contributions,
OA3 is obligated to make those contributions in the amounts that
would otherwise be made by the Company. If OA3 makes those
contributions, it will receive a proportionate interest in Three
Lions, with the exception that for so long as the Company and OA3
collectively hold at least 51% of their initial investment in
Three Lions, the Company will control at least 51% of the voting
power of the members of Three Lions. Additionally, the Company
has appointed three of five members of the Executive Board of
Three Lions. For so long as the Company and OA3 collectively hold
not less than 75% of the membership units they held following the
third capital contribution, and the Company holds not less than
75% of the membership units it held following such third capital
contribution, the Company will continue to be entitled to appoint
and remove three of five members of the Executive Board of Three
Lions.
Three Lions intends to pursue the development, production,
distribution and other exploitation of shows and events that are
broadcast on television and other means of communications. These
shows and events initially include branded awards shows that will
be created to be aired on television.
Overseas Toys, L.P., is the direct beneficial owner of 41,763,668
shares of the Company's common stock, $0.01 par value per share,
representing approximately 82.5% of the Company's outstanding
common stock. Multi-Accounts, LLC, a California limited liability
company is the general partner of Overseas Toys. OA3 is the
managing member of Multi-Accounts. Ronald W. Burkle, an
individual, controls OA3.
Three Lions entered into an Employment Agreement with Richard
Beckman, who will serve as the Chief Executive Officer of Three
Lions. Mr. Beckman is guaranteed a salary of $800,000 per year
for five years, plus certain bonuses and merit raises, subject to
certain termination provisions.
A copy of the Operating Agreement is available for free at:
http://is.gd/kkdEhS
About Simon Worldwide
Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) no longer
has any operating business. Prior to August 2001, the Company
operated as a multi-national full-service promotional marketing
company, specializing in the design and development of high-impact
promotional products and sales promotions. At Dec. 31, 2009,
the Company held an investment in Yucaipa AEC Associates, LLC, a
limited liability company that is controlled by the Yucaipa
Companies, a Los Angeles, California based investment firm.
Yucaipa AEC in turn principally held an investment in the common
stock of Source Interlink Companies, a direct-to-retail magazine
distribution and fulfillment company in North America, and a
provider of magazine information and front-end management services
for retailers and a publisher of approximately 75 magazine titles.
Yucaipa AEC held this investment in Source until April 28, 2009,
when Source filed a pre-packaged plan of reorganization under
Chapter 11 of the U.S. Bankruptcy Code.
The Company's balance sheet at Sept. 30, 2012, showed
$8.03 million in total assets, $60,000 in total liabilities, all
current, and $7.97 million in total stockholders' equity.
SLATER STEELS: Court Rules in Suit Over Site Cleanup
----------------------------------------------------
Valbruna Slater Steel Corporation and Fort Wayne Steel Corporation
sued Joslyn Manufacturing Company, et al., on Feb. 11, 2010.
Valbruna is the current owner of a parcel of land near Fort Wayne,
Indiana, which Joslyn occupied until 1981. Valbruna is currently
engaged in remedial efforts at the site in cooperation with the
Indiana Department of Environmental Management (IDEM). Valbruna's
complaint essentially blames Joslyn for contamination at the site,
and alleges three counts: (1) a cost recovery action under the
Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA); (2) a similar action under the Indiana Environmental
Legal Actions statute; and (3) a declaratory judgment of the
defendant's future liability.
The Site was sold by Joslyn to Slater Steels Corp. in 1981. By
June 2003, Slater Steels filed a voluntary Chapter 11 bankruptcy
petition in the U.S. Bankruptcy Court for the District of
Delaware. At auction, Valbruna Slater Stainless Inc., the
plaintiffs' corporate parent, purchased the site and in April
2004, the plaintiffs purchased the Site from their corporate
parent.
With respect to Plaintiffs' complaint, Joslyn's first move was to
attempt to preclude the suit based on earlier state court
litigation with Valbruna's predecessor-in-interest. The U.S.
District Court for the Northern District of Indiana found that the
Indiana ELA claim was precluded, but that the federal claims
survived.
On January 13, 2012, Joslyn moved for summary judgment against
Valbruna's remaining claims, arguing that they are barred by the
statute of limitations. On March 14, 2012, Valbruna responded,
and moved to strike certain exhibits supporting Joslyn's motion.
In a March 21, 2013 order, a copy of which is available at
http://is.gd/Xvw9Ypfrom Leagle.com, District Judge Jon E. Degulio
denies Joslyn's motion for summary judgment and denies Valbruna's
motion to strike.
According to Judge Degulio, "The federal regulations
differentiating between removal and remedial actions weigh in
favor of classifying Slater's activities at the Site in the 1980s
and 1990s as removal, rather than remedial, activities, and the
balance of the factors referenced by the case law support the same
conclusion. Even if that were not the case, Slater's actions in
the 1980s and 1990s were distinct from the remedial action
underway, and therefore have no impact on when the statute of
limitations began to run."
The complaint is captioned VALBRUNA SLATER STEEL CORP. and FORT
WAYNE STEEL CORP., Plaintiffs, v. JOSLYN MANUFACTURING CO., et
al., Defendants, Cause No. 1:10-CV-044 JD (N.D. Ind.).
SMI PARTNERS: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------
Debtor: SMI Partners, LP
1974 Carolina Place, Suite 216
Fort Mill, SC 29708
Bankruptcy Case No.: 13-01958
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
District of South Carolina (Spartanburg)
Judge: Helen E. Burris
Debtor's Counsel: Lemuel Showell Blades, IV, Esq.
131 Caldwell Street
P.O. Box 10671
Rock Hill, SC 29731
Tel: (803) 329-6115
E-mail: showell@showellblades.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Jack Henry Smith Jr., managing partner.
The Company's list of its largest unsecured creditors filed with
the petition contains only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Culp Elliott & Carpenter Services $4,201
4401 Barclay Down Drive, Suite 200
Charlotte, NC 28209
SOUTHERN MATTRESS: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Southern Mattress Company of Texas, Inc.
dba Taylor Bedding
dba Taylor Bedding Company
1712 Woods Blvd.
Round Rock, TX 78681
Bankruptcy Case No.: 13-10592
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Western District of Texas (Austin)
Judge: H. Christopher Mott
Debtor's Counsel: Frank B. Lyon, Esq.
Two Far West Plaza #170
3508 far West Blvd.
Austin, TX 78731
Tel: (512) 345-8964
Fax: (512) 697-0047
E-mail: franklyon@me.com
Scheduled Assets: $776,706
Scheduled Liabilities: $1,942,581
A list of the Company's 20 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/txwb13-10592.pdf
The petition was signed by Rodney Frazier, president.
SOUTHERN MONTANA: Plan Disclosures Hearing Continued to April 23
----------------------------------------------------------------
The hearing to consider approval of the disclosure statement
explaining the Plan of Reorganization proposed by Lee Allen
Freeman, the trustee for Southern Montana Electric Generation &
Transmission Cooperative Inc. will be continued to April 23, 2013,
at 1:30 PM. Deadline for filing objections to the Disclosure
Statement is extended to April 16.
As reported in the Feb. 20, 2013 edition of the TCR, according to
the Disclosure Statement, the reorganized company will continue to
operate under a 10-year, all requirements power supply agreement
that will replace a prepetition, long-term power supply agreement
with PPL Montana.
Under the new contract, the Reorganized Debtor expects to save
more than $100 million as compared to what it would have had to
pay under the PPL contract. The savings will be channelled to pay
off the Debtor's debt on Highwood Generating Station.
The Plan impairs all claims, except for priority non-tax claims,
which will be paid in full on the effective date of the Plan, and
claims and interests held by members.
About Southern Montana Electric
Based in Billings, Montana, Southern Montana Electric Generation
and Transmission Cooperative, Inc., was formed to serve five
other electric cooperatives. The city of Great Falls later joined
as the sixth member. Including the city, the co-op serves a
population of 122,000. In addition to Great Falls, the service
area includes suburbs of Billings, Montana.
Southern Montana filed for Chapter 11 bankruptcy (Bankr. D.
Mont. Case No. 11-62031) on Oct. 21, 2011. Southern Montana
estimated assets of $100 million to $500 million and estimated
debts of $100 million to $500 million. Timothy Gregori signed the
petition as general manager.
Malcolm H. Goodrich, Esq., at Goodrich Law Firm, P.C., in
Billings, Montana, serves as the Debtor's counsel.
After filing for reorganization in October, the co-op agreed to a
request for appointment of a Chapter 11 trustee. Lee A. Freeman
was appointed as the Chapter 11 trustee in December 2011. He is
represented by Joseph V. Womack, Esq., at Waller & Womack, and
John Cardinal Parks, Esq., Bart B. Burnett, Esq., Robert M.
Horowitz, Esq., and Kevin S. Neiman, Esq., at Horowitz & Burnett,
P.C.
SOUTHERN ONE: Hires DFW Lee & Associates as Broker
--------------------------------------------------
Southern One Twenty One Investments, Ltd. asks the U.S. Bankruptcy
Court for permission to employ George Tanghongs, CCIM, of DFW Lee
& Associates, L.P. as broker of record for the Debtor.
The Debtor represents that it is necessary to retain a broker
immediately for the purpose of closing on a pending offer to
purchase a parcel of the Debtor's property -- a tract of raw land
consisting of approximately 80 acres in the City of
Allen, Collin County, Texas, and situated on Highway 121 and
Chelsea Road -- and performing other brokerage services as may be
necessary and appropriate in the Debtor's bankruptcy case.
Subject to the Court's approval in accordance with 11 U.S.C. Sec.
330(a), the compensation to be paid to the broker will be based
upon the customary commission charged in bankruptcy and non-
bankruptcy matters for the real-estate brokerage services
rendered. George Tanghongs, director of DFW, will charge 6% of
the sales price as commission.
Mr. Tanghongs attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
About Southern One
Southern One Twenty One Investments, Ltd., filed a Chapter 11
petition (Bankr. E.D. Tex. Case No. 12-43311) in Sherman, Texas,
on Dec. 3, 2012. Nicole L. Hay, Esq., at Hiersche Hayward
Drakeley & Urbach P.C., in Addison, Texas, serves as counsel to
the Debtor. The Debtor, a Single Asset Real Estate as defined in
11 U.S.C. Sec. 101(51B), estimated assets and liabilities of at
least $10 million.
The Dallas-based company said in a filing that its principal asset
comprises almost 81 acres near Highway 121 and Chelsea Boulevard
in Allen, Texas. The property is close to a shopping mall.
SP FABRICATORS: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: SP Fabricators, Inc.
Carr No. 3 KM 76.9
Barrio Rio Abajo
Humacao Ind. Park
Humacao, PR 00791
Bankruptcy Case No.: 13-02348
Chapter 11 Petition Date: March 27, 2013
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtors' Counsel: Carmen D. Conde Torres, Esq.
C. CONDE & ASSOCIATES
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: (787) 729-2900
Fax: (787) 729-2203
E-mail: notices@condelaw.com
- and ?
Luisa S. Valle Castro, Esq.
C. CONDE & ASSOCIATES
254 Calle San Jose, 5th Floor
San Juan, PR 00901-1523
Tel: (787) 729-2900
E-mail: notices@condelaw.com
Scheduled Assets: $2,179,577
Scheduled Liabilities: $17,768,253
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
SP Management, Inc. 13-02351
Assets: $555,023
Debts: $3,615,644
The petitions were signed by Humberto Bermudez Garcia, president.
A. A copy of SP Fabricators' list of its 20 largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/prb13-02348.pdf
B. A copy of SP Management's list of its 20 largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/prb13-02351.pdf
STANFORD GROUP: Investors Go to Bat For $300M SEC, Antiguan Deal
----------------------------------------------------------------
Brian Mahoney of BankruptcyLaw360 reported that counsel for
plaintiffs suing Proskauer Rose LLP and Chadbourne & Parke LLP in
class actions over the firms' alleged role in the Stanford Ponzi
scheme asked a Texas federal court Thursday to approve a $300
million deal between the U.S. and Antiguan receivers in charge of
compensating victims of the fraud.
The report related that the counsel is Strasburger & Price LLP,
which represents about 2,300 individual claimant victims who lost
about $570 million in the scheme.
STELLAR BIOTECHNOLOGIES: Incurs $766K Net Loss in FY 2013 Q1
------------------------------------------------------------
Stellar Biotechnologies, Inc., reported a net loss of $765,855 on
$115,727 of revenues for the three months ended Nov. 30, 2012,
compared with a net loss of $957,252 on $135,367 of revenues for
the three months ended Nov. 30, 2011.
The Company's balance sheet at Nov. 30, 2012, showed $2.2 million
in total assets, $1.5 million in total liabilities, and
stockholders' equity of $683,846.
Going Concern Doubt
For the three months ended Nov. 30, 2012, the Company reported a
loss of $765,855, an accumulated deficit of $11.1 million and
working capital of $1.1 million. "Without raising additional
financial resources or achieving profitable operations, there is
substantial doubt about the ability of the Company to continue as
a going concern."
A copy of the consolidated financial statements for the three
months ended Nov. 30, 2012, is available at http://is.gd/B7h1xL
A copy of the Management Discussion and Analysis for the three
months ended Nov. 30, 2012, is available at http://is.gd/zYg1w9
Port Hueneme, Cal.-based Stellar Biotechnologies, Inc.,
commercially produces and markets Keyhole Limpet Hemocyanin
("KLH") as well as to develop new technology related to culture
and production of KLH and subunit KLH ("suKLH") formulations. The
Company markets KLH and suKLH formulations to customers in the
United States and Europe.
KLH is a potently immunogenic (i.e. a substance that induces an
immune response) high-molecular-weight protein. It offers an
ideal carrier molecule for vaccine antigens (i.e., substances that
promote the generation of antibodies) against cancers and
infectious agents. The combination of an antigen against specific
tumor cell-types, conjugated to the Immunogenic ("IMG") KLH
molecule, is the basis for a proven strategy for a new class of
drugs known as therapeutic vaccines. Potent yet proven safe in
humans, KLH is highly prized as a critical component of several
important therapeutic vaccines including vaccines for lymphoma,
bladder, breast, colon, and other cancers.
STEPHEN PUTNAL: Limits on Use of SunTrust Cash Collateral Affirmed
------------------------------------------------------------------
District Judge Marc T. Treadwell in Macon, Georgia, affirmed a
bankruptcy court order granting Stephen S. Putnal's motion to use
SunTrust Bank's cash collateral. The Debtor contends the
Bankruptcy Court erred in the conditions it placed on his use of
the cash collateral. The District Court disagrees.
Mr. Putnal owns and manages several rent-producing properties,
including one in Chattanooga that he leases to a nuclear pharmacy.
In March 2008, the Debtor entered into a Deed of Trust with
SunTrust, granting SunTrust a security interest in the Chattanooga
property, an assignment of rents, and a security interest in those
rents.
The Debtor filed a Chapter 11 bankruptcy petition (Bankr. M.D. Ga.
Case No. 11-53874) on Dec. 5, 2011.
SunTrust filed a more than $3.3 million claim, which was reduced
to roughly $1.1 million after the Debtor surrendered other
properties in which SunTrust had security interests under separate
commercial notes. The Parties agree that as of July 2012, the
value of the Chattanooga property is $470,000. They also agree
that SunTrust has an unsecured claim of more than $500,000. The
Parties further agree that pursuant to 11 U.S.C. Sec. 552(b)(2),
SunTrust has a post-petition interest in rents produced by the
Chattanooga property and these rents are SunTrust's "cash
collateral" as defined in 11 U.S.C. Sec. 363(a).
The Debtor leases the Chattanooga property for $6,966.10 per
month. The lease is a triple-net lease, which means the pharmacy
pays the property's insurance, ad valorem taxes, and maintenance
costs2 separate from the monthly lease payments. Since filing his
Chapter 11 petition, the Debtor has collected and placed into
escrow more than $55,000 in rents from the property.
A few days after filing his Chapter 11 petition, the Debtor moved
the Bankruptcy Court for authorization to use the cash collateral.
SunTrust objected, and after several continuances, the Bankruptcy
Court held a hearing Aug. 22, 2012. At the hearing, the Debtor
proposed to retain about $3,000 of each month's rent to pay the
costs of his bankruptcy and other general expenses. This included
the expense he incurred to have the Chattanooga property appraised
and to renegotiate the lease with the pharmacy. He contended
SunTrust's interest was unified in the land and rents, and that
its interest was adequately protected because the value of the
real property was not impaired.
SunTrust argued its cash collateral was entitled to its own
adequate protection, and that the Debtor's proposed use deprived
it of that because every dollar the Debtor spent decreased the
value of the collateral. Therefore, SunTrust reasoned, the Debtor
was not entitled to use any of the rents.
The Bankruptcy Court granted the Debtor's motion, but found
SunTrust held two distinct security interests -- one in the real
property, and one in rents the property produced. Therefore, to
adequately protect the SunTrust's interest in rents, the
Bankruptcy Court limited the Debtor's use of the money to (1)
$5,000 incurred to appraise the Chattanooga property; (2) any
expenses incurred in negotiating a new lease on the property; and
(3) up to $623.72 per month to pay unreimbursed maintenance
expenses.
On Nov. 30, 2012, the Debtor appealed the Bankruptcy Court's
order. The District Court heard oral arguments March 12, 2013.
Both Parties ask the Court to modify the Bankruptcy Court's
opinion in their favor.
According to Judge Treadwell, the Debtor's arguments rest on the
idea that SunTrust's interest in rents is subsumed by its interest
in the real property, and that so long as the real property's
value is not declining, all that must be protected is a lien in
rents.
"In a very narrow and very abstract sense, this argument has some
logic. When the value of property is determined by the income
method of appraisal, the rents undergird the value of the
property. So long as the stream of rents is guaranteed to
continue, regardless of whether the rents accrue, the value of the
property is maintained," Judge Treadwell said.
"Here, however, the Debtor's argument ignores the nature of the
interest actually assigned to SunTrust. SunTrust took more than
security necessary to maintain the value of the property; it took
an interest in the cash generated by the property. To treat
SunTrust's interest as an interest in only the existence of a lien
in rents to protect the value of the property is to adopt a
replacement lien theory, which does not provide adequate
protection for SunTrust's interest in the revenue the rents
produce."
"Even though a few courts once followed it, the replacement lien
theory has by now been generally discredited, and not just by the
Sixth Circuit panels. Most courts recognize that a prepetition
security interest in rents is a special kind of collateral that,
pursuant to 11 U.S.C. Sec. 552(b), continues in full force and
effect after the petition is filed. As such, the replacement lien
theory's purported protection is seen as 'illusory,'" Judge
Treadwell said, citing In re Smithville Crossing, LLC, 2011 WL
5909527 (Bankr. E.D.N.C.).
"Put another way, a replacement lien simply provides no protection
for the very real interest the creditor has in accruing rents.
That is why 'virtually every case addressing this issue' has
rejected the replacement lien. This Court now does the same."
Judge Treadwell also held that, given that SunTrust holds two
distinct pre-petition interests requiring adequate protection, and
given that the value of its interest in rents is measured by the
rents actually generated, the Debtor's remaining arguments fall
away. As an initial matter, the Debtor's request for remand to
conduct an 11 U.S.C. Sec. 506(a) valuation is unfounded. The
Bankruptcy Court adopted the Parties' stipulated value of the
Chattanooga property and the extent to which SunTrust is
undersecured. Additionally, Judge Treadwell said there is no
constitutional equal protection concern or violation of the cross-
collateralization prohibition in Matter of Saybrook Mfg. Co.,
Inc., 963 F.2d 1490 (11th Cir. 1992), because there has been no
post-petition collateralization of previously unsecured claims.
Even though the post-petition value of the rents increases each
month, SunTrust's security interest is in that continually
increasing value, and this interest existed prior to the filing of
the petition. Similarly, that there are two distinct interests
and that the interest in rents must be protected dollar for dollar
forecloses the Debtor's functional obsolescence argument.
The District Court also said it is not persuaded by the Debtor's
strenuous advocacy of "dual valuation" as discussed in In re
Addison Props. Ltd., 185 B.R. 766 (Bkrtcy. N.D. Ill. 1995). That
theory has not been widely adopted. Second, its criticism of
continuous valuation focuses on interests in property that
fluctuates in value according to market forces rather than
interests in rents that increase by accrual and do not decline.
Third, considering that SunTrust's pre-petition interest in rents
can technically be valued ad infinitum, it is of no help to the
Debtor to value rents for adequate protection purposes at the time
the petition is filed. For even then, the value of SunTrust's
interest is essentially unlimited.
Accordingly, the District Court said, SunTrust has a secured
interest in each dollar in rents that accumulates, and each of
those dollars is entitled to adequate protection. The Debtor may
not use any of the rents to administer his bankruptcy or for other
general purposes, because for each dollar in rents he spends, he
deprives SunTrust of the adequate protection of that dollar. The
Debtor's use of rents is therefore limited to expenses that are
"directly related to the operation, maintenance, or preservation
of the" Chattanooga property, or that "are reasonable and
necessary to preserving or disposing of such property and are
incurred primarily for the benefit of the secured creditor." The
Bankruptcy Court determined this authorized use includes (1)
$5,000 incurred to appraise the Chattanooga property; (2) any
expenses incurred in negotiating a new lease on the property; and
(3) up to $623.72 per month to pay unreimbursed maintenance
expenses. Over SunTrust's objection, the District Court agrees
these uses are permissible. They are necessary to either maintain
the Chattanooga property or to preserve its value for SunTrust's
benefit. Therefore, the District Court declined to alter the
Bankruptcy Court's decision.
The case before the District Court is, STEPHEN S. PUTNAL,
Appellant, v. SUNTRUST BANK, Appellee, Civil Action No. 5:12-CV-
481(MTT) (M.D. Ga.). A copy of the Court's March 28, 2013 Order
is available at http://is.gd/otGlOCfrom Leagle.com.
STEWARD HEALTH: S&P Assigns 'B' CCR & Rates $250MM Loan 'B'
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned Boston, Mass.-based
Steward Health Care System LLC its 'B' corporate credit rating
with a stable outlook.
At the same time, S&P assigned the company's $250 million term
loan B a 'B' issue-level rating, with a recovery rating of '3',
indicating its expectation for meaningful (50%-70%) recovery for
lenders in the event of a payment default.
The ratings on Steward Health Care System LLC reflect its
"vulnerable" business risk profile and "highly leveraged"
financial risk profile, based on S&P's criteria. Key credit
factors considered in S&P's business risk assessment include its
low operating margins, limited geographic diversity, and exposure
to reimbursement risk. S&P's financial risk assessment
incorporates its high adjusted debt leverage, weak cash flow, and
aggressive financial policy, highlighted by a senior management
retention plan in the form of a loan to members of the management
team in lieu of salaries and the potential for a leveraged
dividend payment given its private-equity ownership. Steward is a
low-cost, fully-integrated provider of community-based health care
services in Massachusetts.
"Our base case assumes low-single-digit revenue growth over the
next few years with significant margin expansion. In 2013, we
forecast revenue growth of about 1% based on modest volume growth,
low-single-digit reimbursement rate increases with its commercial
payors, and a 2% reduction in its Medicare reimbursement rate,
largely due to the sequester. Our EBITDA margin projection for
the year assumes about a 200 basis point increase driven by a
combination of improved care retention, staffing efficiencies, and
other cost-cutting measures. In 2014, we expect approximately 2%
revenue growth based on our expectation for relatively flat
Medicare and Medicaid reimbursement rates, low-single-digit
reimbursement rate increases from private insurance payors,
and modest volume growth. We project Steward's EBITDA margin will
expand by about 120 basis points during the year, aided by cost
control efforts," S&P said.
"We view Steward's financial risk profile as highly leveraged
based on our estimate that its pension and lease-adjusted debt-to-
EBITDA ratio will exceed 5x at the end of 2013. We do not expect
the company to generate any free cash flow over the next two years
as it invests in growth, requiring the use of its revolver.
Moreover, we believe free cash flow will be only marginally
positive in later years. As a result, we anticipate the debt-to-
EBITDA ratio will remain near current levels. Our assessment of
Steward's financial risk profile also incorporates our view that
it has an aggressive financial policy. In addition to the
aforementioned loan to members of the management team in 2013,
we believe there is a good probability that Steward will pay a
dividend to its private-equity owner in the near future. We
expect this dividend would be debt-financed, meaningfully
weakening its credit metrics," S&P added.
S&P views the company's business risk profile as vulnerable.
Steward is limited by its focus on the eastern Massachusetts
health care market, where large, reputable academic medical
centers in Boston account for a sizeable portion of patient
discharges. Within this niche market, S&P believes the company is
well positioned as a low-cost provider. However, Steward, like
other hospitals systems, is subject to significant reimbursement
risks. Its large reliance on Medicare leaves it susceptible to
cuts in reimbursement rates.
STEWART INFORMATION: Fitch Affirms 'BB+' Sr. Unsecured Debt Rating
------------------------------------------------------------------
Fitch Ratings has affirmed the 'BBB-' Issuer Default Rating (IDR)
and 'BB+' senior unsecured debt rating of Stewart Information
Services Corp. Fitch has also affirmed the 'BBB+' Insurer
Financial Strength (IFS) ratings of Stewart's insurance
subsidiaries. The Rating Outlook is revised to Positive from
Stable. Fitch has also affirmed and withdrawn the 'BBB' IFS rating
of Stewart Title Limited.
KEY RATING DRIVERS
The revision in Stewart's Outlook reflects significantly improved
operating results, solid capitalization, a conservative investment
portfolio and modest financial leverage.
In 2012, Stewart reported net earnings of $109 million, which
represents its first meaningful profit since 2006 and continues
the trend of steadily improving operating results. This compares
with net earnings of $2 million in the prior year. 2012 results
included the release of $36.6 million of a tax asset valuation
allowance established in 2008.
Stewart benefited from a rising transaction environment as well as
its multi-year effort to improve cost effectiveness, which
included streamlining its management team, centralizing and
leveraging its back-office functions, emphasizing productivity and
profitability in its agency base, and introducing new product
offerings in its mortgage services operations. The company expects
a marginal benefit from the continued materialization of these
initiatives in 2013.
Stewart's capitalization is solid with a risk-adjusted capital
(RAC) ratio of 153% at year-end 2012, flat with the prior year. On
a non-risk-adjusted basis (measured as net written premiums to
surplus) the company's capitalization is also conservative at
3.4x.
Stewart's financial leverage remains modest with a debt to capital
ratio of 10.9%, excluding unrealized investment gains, as of Dec.
31, 2012. During the first quarter of 2013, Stewart exchanged an
aggregate of $37 million of its convertible notes for common
stock. The company's pro forma financial leverage ratio declined
to approximately 5.6% following this transaction.
The affirmation of STL's rating reflects continued profitability
and solid capitalization. Fitch has withdrawn the ratings of STL
as STL has chosen to stop participating in the rating process.
Therefore, Fitch will no longer have sufficient information to
maintain the rating. Accordingly, Fitch will no longer provide
ratings or analytical coverage for STL.
RATING SENSITIVITIES
Key rating triggers that could lead to an upgrade include:
-- Sustained profitability such as an operating profit margin of
4.5% and/or statutory combined ratio below 100%;
-- Capitalization maintained near current levels, including a RAC
ratio above 150%;
-- Financial leverage ratio maintained below 15%.
Failure to sustain operating profitability could lead to a return
to a Stable Outlook.
Key rating triggers that could lead to a downgrade include:
-- Return to operating losses;
-- Capital deterioration whereby Stewart's RAC ratio drops below
110% and/or net written premiums to surplus increases above
4.5;
-- Financial leverage ratio above 25%; or
-- A large reserve charge that exceeds 5% of prior year surplus.
Fitch has affirmed the following ratings with a Positive Outlook:
Stewart Information Services Corp.
-- IDR at 'BBB-';
-- $44 million 6% senior convertible notes due 2014 at 'BB+'.
Stewart Title Guaranty
-- IFS at 'BBB+'.
Stewart Title Insurance Company
-- IFS at 'BBB+'.
Fitch has affirmed and withdrawn the following rating with a
Stable Outlook:
Stewart Title Limited
-- IFS at 'BBB'.
SUPERVALU INC: S&P Raises Corp. Credit Rating to 'B+'
------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Supervalu
Inc., including the corporate credit rating, to 'B+' from 'B'.
S&P removed all ratings from CreditWatch, where it placed them
with positive implications on Jan. 18, 2013. The outlook is
stable.
In addition, S&P affirmed the unsecured debt at 'B-' and revised
the recovery rating on this debt to '6' from '5'.
S&P also assigned a 'B+' issue-level rating and a '3' recovery
rating to the new $1.5 billion term loan due 2019. S&P is
withdrawing the ratings on the existing $850 million term loan due
2018 and $490 million 7.5% notes due 2014 as these were repaid
with proceeds from the new term loan.
"The upgrade reflects the substantial reduction in debt and debt-
like obligations following completion of the transaction," said
Standard & Poor's credit analyst Ana Lai. In addition, S&P
believes SUPERVALU's more-focused operations should help it
stabilize sales and improve margins after the divestiture of its
underperforming retail banners.
Pro forma for the asset sale transaction, SUPERVALU will generate
about 47% of its revenue from its independent business (food
wholesale) division, 25% from Save-A-Lot, and 28% from the five
regional food retailing banners: Cub, Farm Fresh, Shoppers, Shop
'n Save, and Hornbacher's.
S&P continues to view SUPERVALU's business risk profile as "weak"
based on the intensely competitive nature of the food wholesaling
and retailing businesses, and a history of underperformance.
These factors are partially mitigated by a more manageable mix of
remaining businesses supporting a greater potential to stabilize
sales and improve profitability. S&P believes the food
wholesaling business is relatively more stable following the
transaction, the regional banners are better positioned, and value
banner Save-A-Lot has more growth potential. Nonetheless, the
remaining food retailing banners and Save-A-Lot have reported
negative identical sales and SUPERVALU needs to make significant,
though more modest, price investment and improve its merchandising
to narrow negative identical-store sales in fiscal 2014.
The stable outlook reflects S&P's view that a more-focused
SUPERVALU has the potential to stabilize its performance, achieve
modest sales growth, and improve its profitability following the
asset sale of the underperforming food retailing assets. S&P
believes SUPERVALU will maintain debt leverage in the mid-4x area
from slow improvement in sales and modest debt reduction.
S&P could lower the rating if SUPERVALU is unable to stabilize
sales and profitability falls below S&P's expectations due to
competitive pressure or poor execution. An increase in debt
leverage toward the mid-5x area could be driven by a 2% decline in
revenue while gross margin declines 70 bps.
While S&P do not expect to raise the rating in the next year, it
could upgrade the company if its debt leverage declines to below
4x and and it can sustain it at that level. This could occur if
sales growth exceeds 5% and gross margin improves by more than 50
bps.
SYNERGY BRANDS: Auditor Should Have Caught $1B Fraud, Suit Says
---------------------------------------------------------------
Brian Mahoney of BankruptcyLaw360 reported that the largest
secured creditor of bankrupt food products company Synergy Brands
Inc. sued Holtz Rubenstein Reminick LLP in New York state court
Thursday alleging the auditor failed to catch the company's $1
billion check-kiting scheme, which eventually landed Synergy's CEO
in prison for bank fraud.
The report related that Plaintiff Lloyd I. Miller and his company
Milfam I LP say they relied on Holtz Rubenstein's audit reports,
which showed the company's books were in order, when they loaned
at least $3 million to Synergy in 2010.
About Synergy Brands
Synergy Brands, Inc. -- http://www.synergybrands.com/-- develops
Internet properties that strategically partner with off-line and
on-line media companies to capture e-commerce markets within the
B2B and B2C Internet arena. The company has developed the
following Web sites: Netcigar.com, BeautyBuys.com, and
DealByNet.com/
Synergy Brands Inc. filed a Chapter 7 liquidation petition (Bankr.
E.D.N.Y. Case No. 11-70412) on Jan. 28 in Central Islip, New York.
Two of its subsidiaries, PHS Group Inc. and SYBR.com Inc., also
filed for bankruptcy under Chapter 7 of Title 11 of the United
States Bankruptcy Code.
According to Bill Rochelle, the bankruptcy columnist for Bloomberg
News, the petition listed assets of $21.7 million and debt
totaling $44.7 million. Liabilities include $23.7 million in
secured debt.
TCI COURTYARD: Has Plan to Pay Wells Fargo Over Time
----------------------------------------------------
TCI Courtyard, Inc., filed with the U.S. Bankruptcy Court for the
Northern District of Texas on March 5, 2013, an amended disclosure
statement in support of its Amended Plan of Reorganization dated
March 4, 2013. Pursuant to the Plan, the Debtor purposes to
restructure the current indebtedness and continue its operations
of the Property and to provide a dividend to the unsecured
creditors of the Debtor.
Pursuant to the Amended Plan, the debt to Wells Fargo Bank in the
amount of approximately $11,107,039 as of the Petition Date, will
be amortized over 300 monthly payments but will be payable
commencing on the Effective Date in 59 equal monthly payments of
$78,502.24 and one payment on the 60th month after the Effective
Date of all outstanding principal and interest.
The Allowed Unsecured Creditors of $10,000 or less (Class 4) will
be paid 100% of their Allowed Claim in two equal payments. The
first payment will be on the Effective Date and the second payment
will be 30 days later. The Class 4 creditors should not exceed
$15,000.
The Allowed Claims of Unsecured Creditors of $10,001 or more
(Class 5) will receive their pro rata portion of payments made by
the Debtor into the Class 5 Creditors Pool. The Debtor will make
60 equal monthly payments commencing on the Effective Date in an
amount of 50% of all excess income after operating expenses and
payments to classes Class 2, 3 and 4. Based upon the Debtor's
projections the Class 5 Creditors will receive approximately 10%
on their allowed claims.
Class 6 (Current Equity Holders) will retain their current
ownership interests.
The Debtor has transferred funds to its parent company in the
amount of approximately $457,000. The Debtor's payments was for
monies lent, however, the parent company has agreed to refund
those funds to the Debtor over the life of the Plan in 60 equal
payments of $7,650 commencing on the Effective Date. The funds
will be used by the Debtor to maintain the property during the
course of the Plan and to provide any needed funds for payments to
creditors in the event of an unexpected shortfall for the rental
revenues.
A copy of the amended disclosure statement for the Debtor's
Amended Plan of Reorganization is available at:
http://bankrupt.com/misc/tcicourtyard.doc47.pdf
About TCI Courtyard
Dallas, Texas-based TCI Courtyard, Inc., dba Quail Hollow
Apartments, filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case
No. 12-37284) on Nov. 15, 2012. Judge Stacey G. Jernigan presides
over the case. Eric A. Liepins, Esq., serves as the Debtor's
counsel. In its petition, the Debtor scheduled $13,790,254 in
assets and $15,964,116 in liabilities. The petition was signed by
Steven Shelley, vice president.
The Debtor owns a 200-unit apartment in Holland, Ohio known as
Quail Hollow at the Lakes.
According to the Troubled Company Reporter's records, TCI
Courtyard previously filed a Chapter 11 petition (Bankr. N.D. Tex.
Case No. 11-34977) on Aug. 1, 2011. The Liepins firm also served
as counsel in the previous case. The Debtor estimated assets of up
to $10 million and debts of up to $50 million in the 2011
petition.
TENNECO INC: S&P Revises Outlook to Positive & Affirms 'BB' CCR
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its
outlook on Lake Forest, Ill.-based auto supplier Tenneco Inc. to
positive. S&P affirmed all the ratings on the company, including
the 'BB' corporate credit rating.
"The outlook revision reflects our opinion that Tenneco's
profitability and cash flow could rise during the year to levels
consistent with a higher corporate credit rating and that the
company can sustain the improvement," said Standard & Poor's
credit analyst Lawrence Orlowski. Global demand for autos and
trucks will probably rise in 2013 as well. In the company's
largest geographical markets, S&P expects commercial-vehicle
production in North America to be flat to slightly down in 2013
and fall about 9% in Western Europe. S&P forecasts light vehicle
production to be up 3% in North America in 2013 but fall about 9%
in Western Europe. The projected weakness in Europe in 2013 stems
in part from the ongoing consumer uncertainty in the region's
economy. On the other hand, important factors supporting long-
term auto industry growth include the need to replace aging
vehicles, the effect of relaxed monetary and fiscal policies in
spurring economic demand, and strong emerging market sales.
The ratings on Tenneco reflect Standard & Poor's opinion of the
company's "weak" business risk profile, incorporating the
cyclical, highly competitive industry in which it operates, and
"significant" financial risk, reflecting its material level of
leverage and solid cash flow generation.
In 2013, S&P expects revenues to rise about 2% based on ongoing
trends. Tenneco generated record revenue of $7.4 billion in 2012,
up more than 2% compared with 2011 sales, driven by higher light-
vehicle sales in North America, China, and India; good aftermarket
sales in North America; and rising commercial-vehicle sales; and
offset in part by lower European original equipment (OE) sales.
Gross margin was 16.2% in 2012, the same as in 2011. The positive
effects on gross margin came from higher volume and reduced
material costs, offset by the negative effects of OE revenue mix,
currency, and increased manufacturing costs. S&P projects gross
margins of about 17% in 2013 based on the company's disciplined
cost containment.
For the 12 months ending Dec. 31, 2012, adjusted leverage was 2.4x
and the ratio of free operating cash flow to adjusted debt was
10.8%. S&P expects adjusted leverage to be at or below 2x at the
end of 2013 and free operating cash flow to adjusted debt to stay
about 10%.
S&P's rating outlook on Tenneco is positive. S&P believes there
is at least a one-third probability that improving business and
financial risk profiles could support a higher rating over the
next year. To raise the corporate credit rating, S&P would look
for double-digit EBITDA margins, reflecting a strengthening
competitive position and consistent execution. S&P would also
expect to see debt to EBITDA at or less than 2x on a sustainable
basis. This could occur if, for example, the company's revenues
rose more than 5% in 2013 and gross margins were more than 17%.
Moreover, S&P would expect the company to sustain a ratio of free
operating cash flow to adjusted debt of more than 10%.
S&P could revise the outlook to stable if global vehicle demand
began to decline again, thereby weakening the ability of the
company to generate solid free operating cash flow or pushing its
leverage above 2x. This could occur if, for instance, revenue
decreased 5% in 2013 and the gross margin fell below 14%.
TITAN PHARMACEUTICALS: FDA Recommends Approval of Probuphine
------------------------------------------------------------
Titan Pharmaceuticals, Inc., announced that the majority of
Psychopharmacologic Drugs Advisory Committee of the U.S. Food and
Drug Administration members recognized the favorable benefit-risk
profile of Probuphine(R) and voted for approval (10 positive
votes, 4 negative votes and 1 abstention). Probuphine(R) is a
long-acting, subdermal implant formulation of buprenorphine for
the maintenance treatment of adult patients with opioid
dependence. Titan submitted a New Drug Application (NDA) for
Probuphine on Oct. 29, 2012, under Section 505(b)(2) of the Food,
Drug and Cosmetic Act, referencing the approved sublingual tablet
formulations of buprenorphine. The Probuphine NDA was granted
priority review designation with a Prescription Drug User Fee Act
(PDUFA) target action date of April 30, 2013. In December 2012,
Titan announced an exclusive license agreement with Braeburn
Pharmaceuticals to the commercialization rights for Probuphine in
the United States and Canada.
"We are pleased the Committee recognized the favorable benefit-
risk profile of Probuphine and voted in strong favor of its
approval," said Kate Glassman-Beebe, Ph.D., executive vice
president and chief development officer of Titan. "We look
forward to working with the FDA to complete its review of
Probuphine and remain committed to addressing the growing unmet
needs in managing patients with opioid dependence."
The committee also voted in favor of the effectiveness (10
positive votes to 5 negative votes) and safety (12 positive votes
to 2 negative votes, with 1 abstention) of Probuphine. The
largest portion of committee members abstained (6 abstentions, 5
positive votes and 4 negative votes) on the vote pertaining to the
Risk Evaluation and Mitigation Strategy (REMS) program, as the
program is still in discussion with the FDA.
The FDA is not bound by the recommendation of its advisory
committee, but will consider the committee's guidance as it
evaluates the Probuphine NDA.
Members of the Titan management team hosted a conference call to
discuss this update on March 22 at 9:00 a.m. ET.
About Titan Pharmaceuticals
South San Francisco, California-based Titan Pharmaceuticals is a
biopharmaceutical company developing proprietary therapeutics
primarily for the treatment of central nervous system disorders.
The Company's balance sheet at Sept. 30, 2012, showed
$10.74 million in total assets, $37.87 million in total
liabilities, and a $27.13 million total stockholders' deficit.
Following the 2011 results, OUM & Co. LLP, in San Francisco,
California, expressed substantial doubt about Titan's ability to
continue as a going concern. The independent auditors noted that
the Company's cash resources will not be sufficient to sustain its
operations through 2012 without additional financing, and that the
Company also has suffered recurring operating losses and negative
cash flows from operations.
TOTAL MECHANICAL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Total Mechanical, Inc.
P.O. Box 15099
Portland, OR 97214
Bankruptcy Case No.: 13-31882
Chapter 11 Petition Date: March 29, 2013
Court: U.S. Bankruptcy Court
District of Oregon
Judge: Randall L. Dunn
Debtor's Counsel: Albert N. Kennedy, Esq.
TONKON TORP, LLP
888 SW 5th Avenue, #1600
Portland, OR 97204
Tel: (503) 802-2013
E-mail: al.kennedy@tonkon.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/orb13-31882.pdf
The petition was signed by Gregory G. Atkeson, president.
TRIBUNE CO: Slams Bond Trustees' $13M Reimbursement Bid
-------------------------------------------------------
Jamie Santo of BankruptcyLaw360 reported that Tribune Co. urged a
Delaware bankruptcy judge Thursday to spike requests from
bondholders' trustees looking to recoup $13.2 million in
administrative expenses, saying their claims to have provided a
substantial benefit are belied by their continual efforts to
impede the company's reorganization.
The report related that in a 59-page claims objection, Tribune
slammed indenture trustees Wilmington Trust Co. and Law Debenture
Trust Co., who both asserted that their efforts during the media
giant's bankruptcy case brought creditors much-improved recoveries
under the final Chapter 11 plan and merited reimbursement of their
expenses.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Tribune Co. exited Chapter 11 protection Dec. 31, 2012, ending
four years of reorganization. The reorganization allowed a group
of banks and hedge funds, including Oaktree Capital Management and
JPMorgan Chase & Co., to take over the media company.
TWL CORPORATION: Fifth Circuit Revives Employees' Class Suit
------------------------------------------------------------
A three-judge panel of the U.S. Court of Appeals for the Fifth
Circuit vacated a bankruptcy court order denying a motion for
class certification filed by former employees of TWL Corporation
and its primary subsidiary, TWL Knowledge Group, Inc., and
dismissing the employees' adversary proceeding. The Fifth Circuit
said the reasons for the bankruptcy court's order are unclear.
The Fifth Circuit remanded the matter to the district court to
remand to the bankruptcy court for reconsideration in light of
appeals court's opinion.
Frank Teta served as a vice president of TWL. In September 2008,
TWL allegedly laid off the majority of its workforce, including
Mr. Teta. In November, Mr. Teta commenced the class action
adversary proceeding within TWL's bankruptcy, alleging violations
of the Worker Adjustment and Retraining Notification Act, 29
U.S.C. Sections 2101-2109. The bankruptcy court denied Teta's
related motion for class certification and dismissed the adversary
proceeding. The district court affirmed.
The case is FRANK TETA, Appellant, v. MICHELLE CHOW, Appellee.
No. 12-40271 (5th Cir.). A copy of the Fifth Circuit's March 29,
2013 decision is available at http://is.gd/RWx74Lfrom Leagle.com.
TWL Corporation and its primary subsidiary, TWL Knowledge Group,
Inc., were in the business of providing workplace learning,
training, and certification programs.
TWL Corporation and TWL Knowledge Group, Inc., fka Trinity
Workplace Learning Corporation, filed voluntary Chapter 11
petitions (Bankr. E.D. Tex. Case Nos. 08-42773 and 08-42774) on
Oct. 19, 2008. Judge Brenda T. Rhoades presides over the case.
J. Mark Chevallier, Esq. -- mchevallier@mcguirecraddock.com --
at McGuire, Craddock & Strother, P.C., served as the Debtors'
counsel. In its petition, TWL Corp. estimated $1 million to
$10 million in assets and $10 million to $50 million in
liabilities. TWL's reorganization efforts, however, were
unsuccessful, and the court converted the bankruptcy case to
Chapter 7 and appointed Michelle Chow as trustee of the estate.
Guidance for Class Suits
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in New Orleans wrote an
opinion last week giving guidance on when bankruptcy courts should
allow class lawsuits and class claims for violation of the
so-called Warn Act resulting from mass firings without the
required 60-days' notice.
The report recounts that the bankruptcy court had dismissed a
class suit for violating the Worker Adjustment and Retraining
Notification Act. The lower court also dismissed the class claim
one worker filed on behalf of about 130 others. The district
court upheld dismissal of the class claim and the class lawsuit.
According to the report, on appeal, Circuit Judge Carolyn King
wrote a 2-1 opinion returning the case to the bankruptcy court for
a redetermination of whether the suit could proceed on a class
basis. Circuit Judge James E. Graves Jr. agreed with the result,
though he would have ruled that a class suit was proper. Judge
King said that in bankruptcy, as opposed to a lawsuit outside of
bankruptcy, a class with 130 members might not be large enough
because the claims objections process provides a procedure for
efficient disposition of claims. She also said the bankruptcy
court should consider the cost of a class suit because it would
deplete assets for distribution to creditors.
Mr. Rochelle notes that Judge King appears to say there is no
reason for a class suit if the bankrupt company admits liability
for violating the Warn Act. If there are defenses to liability,
she seemed in favor of a class suit because she said "workers
cannot be expected to proceed pro se in the claims process."
Judge King sent the case back to bankruptcy court because there
had been no statement about whether the Chapter 7 trustee would
raise defenses to liability.
Judge Graves, the report discloses, appeared to agree with courts
recognizing "that treating Warn Act claims as class adversary
proceedings is the best way to preserve the estate's assets." He
pointed out how the mere filing of the class claim relieved each
employee of the need to file a claim by the deadline. He said if a
class claim is tossed out, each worker should be given an
opportunity to file an individual claim.
The case is Teta v. Chow (In re TWL Corp.), 12-40271, Fifth U.S.
Circuit Court of Appeals (New Orleans).
TWL Corp. sought Chapter 11 protection (Bankr. E.D. Tex Case No.
08-42773) on Oct. 19, 2008. Mark Chevallier, Esq., at
McGuire, Craddock & Strother, P.C., served as counsel.
U.S. CAVALRY: Updated Case Summary & Creditors' Lists
-----------------------------------------------------
Lead Debtor: U.S. Cavalry Store, Inc.
2855 Centennial Ave.
Radcliff, KY 40160
Bankruptcy Case No.: 13-31315
Chapter 11 Petition Date: March 28, 2013
Court: United States Bankruptcy Court
Western District of Kentucky (Louisville)
Debtor's Counsel: Sandra D. Freeburger, Esq.
DEITZ SHIELDS & FREEBURGER, LLP
101 First Street
P.O. Box 21
Henderson, KY 42419-0021
Tel: (270) 830-0830
E-mail: sfreeburger@dsf-atty.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
Affiliate that simultaneously filed separate Chapter 11 petition:
Debtor Case No.
------ --------
Cavalry Security Group, LLC 13-31316
Assets: $0 to $50,000
Debts: $1,000,001 to $10,000,000
The petitions were signed by James Leonard, president.
A. A copy of U.S. Cavalry Store's list of its 20 largest
unsecured creditors filed together with the petition is available
for free at http://bankrupt.com/misc/kywb13-31315.pdf
B. A copy of Cavalry Security's list of its 17 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/kywb13-31316.pdf
UNIVERSAL HEALTH: Faces WARN Act Suit From Ex-Workers
-----------------------------------------------------
Nathan Hale of BankruptcyLaw360 reported that two former employees
of Universal Health Care Group Inc. have filed a putative class
action in bankruptcy court against the Florida-based health care
company, claiming that it failed to give notice it was terminating
them as required by the Worker Adjustment and Retraining
Notification Act.
The report related that the suit, filed Thursday in Tampa, Fla.,
may not have been the day's worst development for the company, as
FBI and U.S. Department of Health and Human Services agents
executed search warrants at its St. Petersburg offices.
About Universal Health Care
Universal Health Care Group, Inc., owns an insurance company and
three health-maintenance organizations that provide managed care
services for government sponsored health care programs, focusing
on Medicare and Medicaid.
Universal Health was founded in 2002 by Dr. A.K. Desai and grew
its operations of offering Medicare plans to more than 37,000
members to over 20 states.
Universal Health filed a Chapter 11 bankruptcy protection (Bankr.
M.D. Fla. Case No. 13-01520) on Feb. 6, 2013, after Florida
regulators moved to put two of the company's subsidiaries in
receivership.
Universal Health Care estimated assets of up to $100 million and
debt of less than $50 million in court filings in Tampa, Florida.
Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, in
Tampa, serves as counsel to the Debtor.
US AIRWAYS: Fitch Upgrades Issuer Default Ratings to 'B+'
---------------------------------------------------------
Fitch Ratings has upgraded the Issuer Default Ratings (IDR) of
US Airways Group, Inc. (LCC) and its primary operating subsidiary
US Airways, Inc. to 'B+' from 'B-'. The ratings have been removed
from Rating Watch Positive. The ratings were put on Rating Watch
Positive on Feb. 14 following the merger announcement with
American Airlines (AAMRQ; IDR: 'D'). The Rating Outlook is
Positive. The ratings apply to $1.1 billion of term loan debt and
$179 million of convertible notes outstanding.
The upgrade of LCC's ratings reflects the continued improvement of
its credit profile on a standalone basis and does not incorporate
potential benefits from its pending merger with American. The
Positive Rating Outlook reflects the potential credit benefits
from the merger over the next one to two years. Fitch maintains
its view that the proposed merger, expected to close in third
quarter, enhances LCC's network and credit profile but expects
potential benefits to be realized over the longer term. An airline
merger is typically a multi-year process. In addition to the
customary anti-trust approval from the Department of Justice, the
merged airline will require a single operating certificate from
the Federal Aviation Administration, which may take 18-24 months,
before operations can be fully integrated. The bankruptcy court's
approval, also required given AAMRQ's current Chapter 11
restructuring was received last week.
KEY RATING DRIVERS
The upgrade of LCC's ratings reflects the transformation of LCC's
business model that has significantly improved its financial
profile since the credit crisis. During the past year, LCC
produced record revenues, profitability and cash flow, ahead of
Fitch's expectations, in spite of a lackluster macro environment
and volatile fuel. As a result, LCC's credit metrics notably
improved. While significant risks remain, Fitch believes LCC is in
a better position to withstand a weak operating environment or
higher fuel costs, and the company's credit profile has improved
beyond what was implied in the prior rating. Other factors
supporting the ratings include structural changes in the U.S.
airline industry and LCC's relative cost position (including no
defined benefit pension plan) which gives the company significant
operating leverage in a growing economy. Fitch's primary concerns
for LCC on a standalone basis include the company's high debt
levels including looming maturities next year, and limitations on
its ability to reduce network capacity based on current pilot
contracts, in addition to the cyclicality and event risk inherent
in the airline industry. Although LCC's unhedged fuel strategy
poses a risk in a severe fuel spike scenario, current industry
fundamentals enable LCC and its peers to largely pass on higher
fuel costs through higher fares when demand is rising, or cut
capacity when demand is falling.
Traffic Performance
With hubs in smaller cities, and a few international routes, LCC's
network is not as robust as its legacy peers, but still produces
leading traffic results. LCC's passenger revenue per available
seat mile (PRASM) rose 4.3% last year reflecting record load
factors and a 3.5% increase in yields. Total revenues increased by
5% to $13.8 billion on 2% capacity growth. LCC's yield and PRASM
gains reflect higher share of corporate revenues as well as the
airline's ability to tactically flex its schedule to better manage
off-peak periods and seasonality. For perspective, LCC operates a
flex schedule for 104 days of the year, when it flies an extra
bank in Phoenix using the same assets, and also tweaks the
schedule for off-peak days depending on the time of the year, or
day of the week. During the month of December, LCC flies 8% fewer
seats during the first half of the month compared to the holiday
period during the second half.
Demand trends for both leisure and business travel remains solid
as per management guidance, but Fitch expects PRASM gains to
moderate this year. Record high load factors support continued
yield improvements but the extent to which fares increase this
year depends on the macro environment, in Fitch's view.
Furthermore, LCC's guidance for a 3% increase in capacity (2.7%
domestic, 3.6% international) is expected to pressure PRASM
driving Fitch's expectation for PRASM increase in low-single
digits this year, and 4%-5% growth in total revenues. LCC's
capacity increase reflects 'upgauging' of replacement fleet rather
than expansion. In 2013, LCC intends to retire 18 of its smaller-
gauge vintage 737-400s and replace them with 16 A321-200s which
have 60 additional seats. While the increase in available seat
miles (ASMs) weighs on PRASM, it improves profitability as Fitch
expects LCC to place larger aircraft on routes where it is likely
spilling traffic which should lower operating unit costs (CASM).
Operating Earnings
Overall, LCC continues to maintain a cost advantage relative to
its network peers given no pension costs, or labor sweeteners from
the 2005 America West merger (pilot groups have yet to agree on
seniority integration). LCC's strategy to not hedge for fuel also
gives the airline a fuel cost advantage relative to hedged peers
who pay a premium. The strategy has worked well over the last
couple of years given the tight capacity environment which enables
LCC and its peers to largely pass along higher fuel costs through
higher fares. However, the lack of downside protection during a
potential fuel spike could become risky especially when combined
with a soft economy which would likely eradicate any pricing
power.
LCC's 2012 operating income of $894 million almost doubled from
prior year, reflecting a 6.5% margin, which increased by 300 basis
points (bp) despite higher fuel price. The average price per
gallon of jet fuel was $3.17 last year versus $3.11 in 2011,
although total fuel costs were 3% lower reflecting reduced fuel
burn from the induction of new aircraft. The last time LCC paid
$3.17 for a gallon of jet fuel was in 2008 when the company
generated an operating loss of $606 million and found itself in a
liquidity crisis. For 2013, Fitch expects LCC's operating income
to approach a $1 billion assuming fuel price of $3.25 per gallon.
While the macro environment has improved since the credit crisis,
the sharp turnaround in profitability reflects a number of
initiatives that LCC and the industry have implemented to
fundamentally change the operating landscape of the U.S. airline
industry. Fitch summarizes these initiatives as the four 'Cs' -
capacity constraint, consolidation, 'charge-for-everything' (i.e.
ancillary revenues) and cost convergence. Notably, LCC management
has led the industry on consolidation and the introduction of
ancillary fees.
Cash flow and Liquidity
LCC's cash from operations of $1 billion in 2012 more than doubled
from the prior year, driven primarily by a similar increase in
funds from operations (FFO) and $219 million contribution from
working capital. Despite higher capital expenditures, LCC
generated $242 million of free cash flow (FCF) last year reversing
from the negative FCF recorded a year earlier. LCC's FCF has been
positive in two of the past three years. Fitch expects LCC's capex
budget to remain elevated in upcoming years due to necessary fleet
replenishment and other product investments including Wi-Fi and
enhancements to its business-class. Aircraft deliveries for the
year include 16 A321-200s and five A330-200s. LCC has already
funded a significant portion of its upcoming deliveries through
the EETC market. Fitch's base case forecast which includes
conservative operating assumptions and gross capex projects FCF to
be modestly negative in 2013, but net of aircraft related
financing FCF should be positive. LCC has backstop financing for
all its single-aisle aircraft through 2015, but Fitch expects the
airline to use the loan and/or capital markets or sale leaseback
to finance its aircraft deliveries over the next few years.
Debt maturities of $417 million are manageable this year but are
substantial in 2014 when $1.1 billion of its term loan matures in
March and $172 million of convertible notes come due in May 2014.
Fitch expects LCC to refinance the term loan this year, well in
advance of its maturity.
LCC's liquidity has improved with the unrestricted cash balance
increasing by $429 million to $2.4 billion at year-end 2012,
representing 17% of revenues versus 15% at year-end 2011. Unlike
its larger peers, LCC does not have a revolving credit facility.
LCC also has few unencumbered assets, but a larger collection of
under encumbered assets that could be used to shore-up liquidity
near term. These include engine and spare parts currently pledged
at low advance rates, and the option to issue a C-tranche for its
series 2012-2 EETC.
Fitch notes that LCC is highly reliant on capital markets and
external sources of liquidity. However, LCC maintains a solid
standing in the markets and has had access to diverse sources of
funding over the past several years. Importantly, management has
shown willingness in the past, to pull different levers including
issuing equity even at distressed levels to preserve the balance
sheet. Access to capital markets is a very important consideration
for LCC's current ratings as the carrier has very few unencumbered
assets.
Fitch views LCC's liquidity to be adequate to withstand a moderate
fuel or demand shock. Fitch expects LCC to be in compliance with
its only financial covenant under its credit facility that
requires the company to maintain a minimum unrestricted cash
balance of $850 million. Fitch also expects LCC to be in
compliance with the minimum liquidity requirements (undisclosed)
under its unsecured, frequent flier miles purchase agreement with
Barclays.
Capital Structure and Leverage
Despite improving earnings and cash flow, LCC's debt levels remain
high. Total debt and capital leases at year-end 2012 stood at $4.8
billion reflecting a net increase of $227 million during the year.
Approximately 93% of outstanding debt is secured, including 33%
comprised of EETCs. Debt issuance last year included $624 million
of equipment notes issued under its 2012-1 series EETC, and is
expected to increase again this year as LCC issues equipment notes
related to its 2012-2 series.
LCC is also a heavy user of off-balance-sheet operating leases but
Fitch expects LCC to own more of its aircraft over time. Fitch
calculates adjusted debt by capitalizing lease payments at an 8
times (x) multiple. Fitch evaluates adjusted debt and leverage
metrics both on an aircraft rent only basis (Aircraft lease-
adjusted) as well as including all rental expenses (Fitch lease-
adjusted). Aircraft lease-adjusted metrics are more appropriate
for peer comparison while Fitch lease-adjusted metrics enables
airline companies to be compared across other industries.
Leverage measured by Fitch lease-adjusted debt / EBITDAR improved
by over a turn to 6.2x at year-end 2012 from 7.4x a year ago, and
was in-line with Fitch's estimates. For 2013, Fitch expects
leverage to remain relatively flat, but improve to approximately
5x in two years with continued earnings growth. Aircraft lease-
adjusted debt is slightly lower at 5.5x at year-end 2012 compared
to 7.2x at year-end 2011. LCC's heavy debt burden will remain a
limiting factor for further improvement in the company's credit
profile on a standalone basis.
RATING SENSITIVITIES
The Outlook is Positive which indicates that further positive
rating action is possible over time following the successful
completion of the pending merger with AAMRQ. Fitch's analysis of
the merger's benefits will focus on a more detailed analysis of
the combined entity's capital structure, margin and cash flow
profile, the strategic position of the 'new American' and the
integration plan.
Once merged, Fitch expects the credit profiles of the two carriers
to be stronger together than apart. The merger expands the reach
of both airlines' individual networks, as the two currently have
relatively little overlap in their route structures, and is
expected to create the nation's largest airline with leading
positions in key U.S. markets.
The combination of LCC's profits, AAMRQ's restructured costs and
terms of the tentative pilot agreement suggest that the margin
profile of the 'new American' could potentially be at par or
possibly exceed its peers near term. The memorandum of
understanding for the pilot group stipulates lower wages than
Delta (DAL) and United (UAL) until 2016, and notably excludes
profit-sharing (incremental $522 million of contractual
improvements over six years instead) which adds approximately $250
million-$400 million to DAL and UAL's operating expenses. The 'new
American' also anticipates $1 billion in synergies, including $900
million from revenues, and $150 million from costs.
However, like all airline mergers, integration challenges are a
concern, especially those related to IT functions and labor. Labor
risks are largely mitigated by the tentative agreements currently
in place for all labor groups including the pilots. Also, LCC
management is experienced in the merger process including
integrating an airline operating in Chapter 11. Nonetheless, Fitch
anticipates execution risks through the integration process, both
for merging the technology platforms as well as integrating the
pilot seniority lists, which could delay the combined entity's
ability to realize expected synergies.
Fitch expects a possible upgrade would most likely be one notch,
depending on the credit profile of the combined airline. The
ratings could be affirmed at the current levels and the Outlook
Revised to Stable if the merger is not completed, or if Fitch
considers the merger's potential benefits to be insufficient to
raise the credit profile. A negative rating action is not
anticipated at this time absent a drastic and sustained fuel shock
or other unexpected severe drop in demand for air travel, or
difficulty accessing the capital markets.
US Airways' EETCs
In conjunction with the upgrade of LCC's IDR, Fitch has upgraded
the subordinate tranches for LCC 12-1 and LCC 12-2. Fitch assigns
subordinate tranche EETC ratings by notching up from the IDR as
per Fitch's EETC criteria, therefore the subordinate tranche
ratings have been upgraded lock-step with LCC's IDR. For LCC 12-1,
Fitch has upgraded the Class B certificates to 'BB+' and the Class
C certificates to 'BB-' maintaining the three notch and one notch
uplift for the subordinate tranches, respectively. For LCC 12-2,
Fitch has upgraded the Class B certificates to 'BB+', maintaining
the three notch uplift from the IDR.
However, for senior tranche ratings, Fitch's EETC criteria
prescribed a 'top-down' approach with a secondary dependence on
the airline IDR. Accordingly, senior tranche ratings for LCC 12-1
and LCC 12-2 have been affirmed. Please see full list of ratings
actions at the end of the release.
Fitch has taken these ratings actions:
US Airways Group, Inc.
-- IDR upgraded to 'B+' from 'B-';
-- Senior secured term loan due 2014 upgraded to 'BB+/RR1' from
'BB-/RR1';
-- Senior unsecured convertible notes due 2014 and 2020 upgraded
to 'B-/RR6' from 'CCC/RR6'.
US Airways Inc.
-- IDR upgraded to 'B+' from 'B-'.
US Airways Pass Through Trusts Series 2012-1
-- Class A certificates affirmed at 'A-';
-- Class B certificates upgraded to 'BB+' from 'BB-';
-- Class C certificates upgraded to 'BB-' from 'B'.
US Airways Pass Through Trusts 2012-2
-- Class A certificates affirmed at 'A-';
-- Class B certificates upgraded to 'BB+' from 'BB-'.
The Rating Outlook is Positive.
USA BABY: 7th Cir. Nixes Ex-Officer's Appeal, Threatens Sanctions
-----------------------------------------------------------------
Scott Wallis has appealed to this court repeatedly to challenge
proceedings in the bankruptcy of USA Baby, of which he is the
former president and a minority shareholder. See, e.g., In re USA
Baby, Inc., 674 F.3d 882 (7th Cir. 2012); In re USA Baby, Inc.,
424 F. App'x. 558 (7th Cir. 2011).
Creditors forced USA Baby, Inc., into bankruptcy under Chapter 11,
and the bankruptcy court appointed Barry Chatz as trustee. Scott
Wallis, the company's former president and minority shareholder,
appealed to the U.S. Court of Appeals for the Seventh Circuit,
asserting that the bankruptcy court erred in denying his motion
for leave to sue Mr. Chatz on claims of negligence, breach of
fiduciary duty, and racketeering related to the trustee's decision
to convert the case to a Chapter 7 bankruptcy and forego pursuing
certain claims for money allegedly due from USA Baby's
franchisees.
USA Baby owed approximately $2.6 million to its creditors,
including nearly $1.2 million to Commerce Capital, LP, which had a
security interest in almost all of USA Baby's assets. The
company's personal property, trademarks, and franchise agreements
did not cover its debts, but the business listed other assets
worth over $10 million in the form of unpaid franchise fees and
purported legal claims against franchisees. Mr. Chatz asked
Commerce Capital, the primary secured creditor, to fund litigation
pursuing these claims, but it declined and subsequently sought
(and was granted) relief from the automatic stay to foreclose on
its lien against USA Baby's personal property. Mr. Chatz sought
to convert the bankruptcy proceeding to Chapter 7 after concluding
that he could not obtain enough funding to continue in Chapter 11.
Mr. Wallis initially appealed the bankruptcy court's denial of
leave to the district court, and that court refused to hear the
appeal. It reasoned that the bankruptcy court's order was
interlocutory (the bankruptcy was still ongoing) and that Mr.
Wallis had not sought leave for an interlocutory appeal to the
district court in compliance with 28 U.S.C. Sec. 158(a)(3) or Rule
8003 of the Federal Rules of Bankruptcy Procedure.
The Seventh Circuit, concluded, however, that the bankruptcy
court's order was final. According to a three-judge panel
consisting of Circuit Judges Richard A. Posner, Diane P. Wood, and
John Daniel Tinder, because the bankruptcy court denied Mr.
Wallis's motion for leave to sue Mr. Chatz, Mr. Wallis was
foreclosed from pursuing his claims against Mr. Chatz in another
forum. With the proposed lawsuit against Mr. Chatz finished before
it even began, the order was therefore final and appealable, and
the appeals court may reach the merits even though the district
court declined to do so.
The Seventh Circuit noted that Mr. Wallis voiced the sole
opposition to both the relief from stay and the conversion to
Chapter 7, as well as a number of other issues. He filed motions
to disqualify the judge, for examination of Mr. Chatz as trustee
under Federal Rule of Bankruptcy Procedure 2004, and to permit
himself to stand in for Mr. Chatz to pursue USA Baby's claims
against franchisees.
In support of his motion to stand in for Mr. Chatz, Mr. Wallis
relied on Fogel v. Zell, 221 F.3d 955, 965-66 (7th Cir. 2000),
arguing that Mr. Chatz acted negligently, breached his fiduciary
duties to the estate, and was not disinterested. The bankruptcy
court denied his motion to replace Mr. Chatz, and the Seventh
Circuit upheld the decision, concluding that there was no evidence
"that Chatz failed to exercise sound business judgment in his
decision not to pursue the claims Wallis envisions against the
franchisees and others."
The Seventh Circuit noted that Mr. Wallis's motion for leave to
sue Chatz relies predominantly on the same arguments used to
support his motion to stand in for Mr. Chatz.
"Having already rejected those arguments, we need not say much
more about them, except for one. Wallis makes much of a supposed
conflict of interest arising from Mr. Chatz's father -- employed
by the same law firm as his son, Arnstein & Lehr LLP -- having
represented a party adverse to USA Baby in an earlier proceeding.
But Chatz disclosed this prior matter to the bankruptcy court in
an affidavit upon his appointment as trustee. The party previously
represented by Chatz's firm settled with USA Baby well before
these bankruptcy proceedings began, and thus had no remaining
interest. As to Chatz's alleged negligence and breach of fiduciary
duties, Wallis offers no reason to disturb our previous conclusion
that those arguments lack merit, nor do his bare assertions of a
conspiracy with Commerce Capital find any support in the record.
We therefore conclude that the district court did not abuse its
discretion in denying Wallis's motion for leave to sue Chatz," the
appeals court said.
According to the Seventh Circuit, the only real issue "in this
frivolous appeal" is sanctions. In Mr. Wallis's last appeal, the
Seventh Circuit warned him that "[t]he next time he files a
frivolous appeal he will be sanctioned." Had Mr. Wallis filed his
current appeal after that warning, the appeals court said it would
sanction him now, without pausing to give Mr. Wallis a chance to
convince the court that sanctions are improper. "But because he
filed this appeal nine months before we issued that warning (and
despite filing his brief three months afterwards), we give Wallis
14 days to show cause why he should not be sanctioned," the
appeals court said.
In a March 27, 2013 order available at http://is.gd/Xh5W8sfrom
Leagle.com, the Seventh Circuit dismissed the appeal and directed
Mr. Wallis to show cause in 14 days why he should not be
sanctioned.
About USA Baby
Based in Lombard, Illinois, USA Baby Inc. sold infant and
children's furniture. USA Baby was formed in 2003 to franchise
stores selling furniture and other products for babies and
children. It operated no stores of its own.
On Sept. 5, 2008, three creditors, Wallis Kraham of Binghamton,
N.Y., Jack B. Whisler of Arlington Heights, Ill., and Leslie Ruess
of San Diego, filed an involuntary Chapter 11 petition (Bankr.
N.D. Ill. Case No. 08-23564), claiming breach of subscription
agreement and seeking $122,875 in the aggregate. Abraham
Brustein, Esq., at Dimonte & Lizak, LLC, represented Wallis
Kraham, one of the petitioning creditors.
The bankruptcy court entered an order for relief, leaving USA Baby
in possession of the bankruptcy estate, but the corporation did
not file the required bankruptcy schedules or statements.
A group of franchisees, citing that failure and alleging a history
of prepetition mismanagement by Scott Wallis, the company's
president and a 5% stockholder, asked the bankruptcy court to
appoint a trustee and convert the case to Chapter 7. While those
motions were pending, the company filed a statement of affairs and
the required schedules.
The bankruptcy court appointed Barry Chatz as trustee but denied
the franchisees' motion for conversion to Chapter 7. Days later,
though, Mr. Chatz filed his own motion for conversion, citing lack
of funding. The bankruptcy court converted the case but also
allowed Mr. Chatz to continue operations for a limited time.
In May 2009, Commerce Capital LP was granted relief from the
automatic bankruptcy stay to foreclose on a lien against USA
Baby's assets. On July 6, 2009, Commerce Capital conducted a
foreclosure sale of the assets, which included USA Baby's
trademarks and franchise agreements, and through credit bidding,
purchased the assets itself for $1 million. On Nov. 18, 2009,
Commerce Capital brought a claim against a franchisee group, the
United Storeowners Association of Baby Stores, LLC, for
unauthorized use of intellectual property formerly belonging to
USA Baby and currently belonging to Commerce Capital. Commerce
Capital subsequently settled a number of claims against the
franchisees regarding the trademarks and franchise agreements.
VHGI HOLDINGS: Amends Report on Shares Issuance to CEO
------------------------------------------------------
VHGI Holdings, Inc., filed an amendment No. 1 to its current
report on Form 8-K originally filed Feb. 27, 2013, for the sole
purpose of including additional information under Item 5.01 as the
result of the Company's receipt of updated stock ownership
information from its transfer agent following the date of the
original filing.
As previously reported, the Company issued a total of 500,000
shares of its Series D Convertible Preferred Stock to Paul R.
Risinger, the Company's Chief Executive Officer and sole director.
Immediately prior to the effectiveness of the Exchange Agreement,
Mr. Risinger may be deemed to have beneficially owned 50,300,000
shares, or 29.3%, of the Company's common stock. Immediately
following the effectiveness of the Exchange Agreement, Mr.
Risinger may be deemed to have beneficially owned 550,300,000
shares, or 81.93%, of the Company's common stock. Immediately
following the issuance of the Warrants, Mr. Risinger may be deemed
to have beneficially owned 1,308,425,941 shares, or 91.51%, of the
Company's common stock.
A copy of the Form 8-K is available for free at:
http://is.gd/cspBmS
About VHGI Holdings
Fort Worth, Tex.-based VHGI Holdings, Inc., is a holding company
with revenue streams from these business segments: (a) precious
metals (b) oil and gas (c) coal and (d) medical technology.
In a report on the Company's consolidated financial statements for
the year ended Dec. 31, 2011, Pritchett, Siler & Hardy, P.C., in
Salt Lake City, Utah, expressed substantial doubt about VHGI
Holdings' ability to continue as a going concern. The independent
auditors noted that the Company has incurred substantial losses
and has a working capital deficit.
The Company reported a net loss of $5.43 million in 2011, compared
with a net loss of $1.67 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $49.07
million in total assets, $54.61 million in total liabilities and a
$5.53 million total stockholders' deficit.
"The Company has current liabilities in excess of current assets
and has incurred losses since inception. The Company has had
limited operations and has not been able to develop an ongoing,
reliable source of revenue to fund its existence. The Company's
day-to-day expenses have been covered by proceeds obtained, and
services paid by, the issuance of stock and notes payable. The
adverse effect on the Company's results of operations due to its
lack of capital resources can be expected to continue until such
time as the Company is able to generate additional capital from
other sources. These conditions raise substantial doubt about the
Company's ability to continue as a going concern."
VITRO SAB: Takes Nondebtor Release Ban to Supreme Court
-------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that Vitro SAB de CV
on Wednesday petitioned the U.S. Supreme Court to review the Fifth
Circuit's decision rejecting nondebtor affiliate releases in the
Mexican glassmaker's reorganization plan, saying the ruling
weakens cooperation between U.S. and foreign courts involved in
cross-border insolvency proceedings.
The report related that the appellate court's November decision
affirmed a Texas bankruptcy court's ruling that approved Vitro's
Mexican reorganization plan under a Chapter 15 proceeding, but
refused to enforce the releases of Vitro's nondebtor affiliates,
saying they run contrary to U.S. public policy.
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.
VPR OPERATING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: VPR Operating, LLC
1406 Camp Craft Road
Suite 106
Austin, TX 78746
Bankruptcy Case No.: 13-10599
Affiliates that simultaneously filed Chapter 11 petitions:
Debtor Case No.
------ --------
VPR Corp. 13-10604
VPR (NM), LLC 13-10606
VPR (OK), LLC 13-10607
Chapter 11 Petition Date: March 29, 2013
Court: United States Bankruptcy Court
Western District of Texas (Austin)
Judge: Craig A. Gargotta
Debtor's Counsel: Brian John Smith, Esq.
PATTON BOGGS LLP
2000 McKinney Ave.
Suite 1700
Dallas, TX 75201
Tel: (214) 758-1500
Fax: (214) 758-1550
E-mail: bsmith@pattonboggs.com
Lead Debtor's
Estimated Assets: $50,000,001 to $100,000,000
Lead Debtor's
Estimated Debts: $50,000,001 to $100,000,000
The petition was signed by Robert B. Pullen, Sr., president.
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Pinpoint Drilling & Trade $986,602
Directional Services LLC
PO BOX 204093
Houston, TX 77216-4093
Universal Pressure Trade $881,679
Pumping Inc
4510 Lamesa Highway
Snyder, TX 79549
Propetro Services, Inc. Trade $530,067
1706 South Midkiff Rd
Building B
Midland, TX 79701
Stemcor AG Trade $524,255
8505 Technology
Forest Place
Suite 401
The Woodlands, TX 77381
Professional Directional Trade $510,178
Enterprises, Inc.
P.O. Box 677457
Dallas, TX 75267-7457
NW Oil Services, LLC Trade $494,514
900 Kastrin St.
El Paso, TX 79907
Tesco Corporation (US) Trade $492,649
3993 W Sam Houston
Pkwy. N., Suite 100
Houston, TX 77043
TanMar Rentals LLC Trade $439,893
PO BOX 1376
Eunice, LA 70535
Oil States Energy Trade $432,428
Services
1600 W. Highway 6,
Ste 418
Alvin, TX 77511
Par Five Energy Trade $376,449
Services, LLC
PO Box 993
Artesia, NM 88211
Tiger of the North Trade $368,406
Transportation, LLC
1614 N Gulf Street
Hobbs, NM 88240
The Artesia Lumber Co. Trade $317,857
P.O. Box 5564
Midland, TX 79704
Gandy Corporation Trade $302,424
P.O. Box 2140
Lovington, NM 88260
Oil Dog Pipe Rentals Trade $290,393
P.O. Box 4545
Midland, TX 79704
EMS USA, Inc. Trade $264,234
2000 Bering Drive,
Suite 600
Houston, TX 77057
Patterson Services, Inc. Trade $256,764
8032 Main St.
Houma, LA 70360
Choice Oilfield Service Trade $239,756
PO Box 337
Lovington, NM 88260
De La Sierra Trucking Trade $238,489
Inc.
3116 Rose Road
Hobbs, NM 88242
Eunice Well Trade $236,809
Servicing, Inc.
PO Box 1500
Hobbs, NM 88241
ABC Rental Tool Co. Trade $236,244
dba Cavaloz Energy Inc.
PO Box 1500
Hobbs, NM 88241
WIZARD WORLD: Two Directors Appointed to Board
----------------------------------------------
The Board of Wizard World, Inc., approved by unanimous written
consent the appointment of Paul L. Kessler and Mr. Kenneth Shamus
as members of the Board. The Company entered into Director
Agreements with Messrs. Kessler and Shamus in connection with
their appointment.
The term of the Director Agreements commences on March 17, 2013,
and continues through the Company's next annual stockholders'
meeting.
Mr. Kessler, age 52, combines over 30 years of experience as an
investor, financier and venture capitalist. In 2000, Mr. Kessler
founded Bristol Capital Advisors, LLC, a Los Angeles based
investment advisor, and has served as the Principal and Portfolio
Manager from 2000 through the present. Mr. Kessler has broad
experience in operating, financing, capital formation,
negotiating, structuring and re-structuring investment
transactions. He is involved in all aspects of the investment
process including identification and engagement of portfolio
companies. His investment experience encompasses both public and
private companies. Mr. Kessler works actively worked with
executives and boards of companies on corporate governance and
oversight, strategic repositioning and alignment of interests with
shareholders.
Mr. Shamus, age 42, combines over 25 years of experience in the
Toys & Collectibles Industry. From 1990 through present, Mr.
Shamus is the Chief Executive Officer of ToyWiz, Inc., an online
toys, action figures and trading card games company.
On May 31, 2011, the Company entered into an agreement with
ToyWiz, Inc., a company run by Mr. Shamus to monetize the ToyWiz
website. Under the terms of such agreement, ToyWiz is paid 50% of
the advertising revenue attributable to the ToyWiz site, with a
minimum guarantee of $5,000.00 per month.
On March 17, 2013, the Board authorized the creation of a
Compensation Committee. The Board has appointed Greg Suess as
chairman and Vadim Mats and John Maatta will serve as initial
members of the Compensation Committee. Also on March 17, the
Board authorized the creation of an Audit Committee. Vadim Mats
was appointed as chairman and Mr. Shamus and Mr. Kessler will
serve as initial members of the Audit Committee.
Additional information can be obtained for free at:
http://is.gd/GiJmzG
About Wizard World
Based in New York, N.Y., Wizard World, Inc., is a producer of pop
culture and multimedia conventions ("Comic Cons") across North
America that markets movies, TV shows, video games, technology,
toys, social networking/gaming platforms, comic books and graphic
novels. These Comic Cons provide sales, marketing, promotions,
public relations, advertising and sponsorship opportunities for
entertainment companies, toy companies, gaming companies,
publishing companies, marketers, corporate sponsors and retailers.
The Company's balance sheet at Sept. 30, 2012, showed $2.58
million in total assets, $6.78 million in total liabilities and a
$4.19 million total stockholders' deficit.
"As reflected in the accompanying consolidated financial
statements, the Company had an accumulated deficit at
September 30, 2012, and had a net loss for the interim period then
ended. 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.
WISPER LLC: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Wisper, LLC
1378 North Cavalier Drive
Alamo, TN 38001
Bankruptcy Case No.: 13-10770
Chapter 11 Petition Date: March 27, 2013
Court: U.S. Bankruptcy Court
Western District of Tennessee (Jackson)
Judge: Jimmy L. Croom
Debtor's Counsel: Thomas Harold Strawn, Jr., Esq.
STRAWN & EDWARDS, PLLC
314 North Church Avenue
Dyersburg, TN 38024
Tel: (731) 285-3375
Fax: (731) 285-3392
E-mail: tstrawn42@bellsouth.net
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/tnwb13-10770.pdf
The petition was signed by George Matthew Abernathy, president.
WOUND MANAGEMENT: Issues $500,000 Promissory Notes
--------------------------------------------------
Wound Management Technologies, Inc., issued two convertible
promissory notes on Feb. 19, 2013, each in the principal amount of
$250,000. The Notes were issued to Solomon Oden Howell, Jr., and
the James W. Stuckert Revocable Trust, each a current shareholder
of the Company.
Each of the Notes carries an interest rate of 10% per annum, and
all principal and accrued but unpaid interest under the Notes is
due and payable upon achievement by the Company of certain revenue
targets under existing international distribution agreements.
Additionally, all principal and accrued but unpaid interest under
the Notes may be converted, at the option of the holder, into
shares of the Company's common stock at a conversion price of $.07
per share, or into an equivalent number of shares of the Company's
Series C Preferred Stock.
About Wound Management
Fort Worth, Texas-based Wound Management Technologies, Inc.,
markets and sells the patented CellerateRX(R) product in the
expanding advanced wound care market; particularly with respect to
diabetic wound applications.
Pritchett, Siler & Hardy, P.C., in Salt Lake City, Utah, expressed
substantial doubt about Wound Management'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 substantial losses and has a working capital
deficit.
The Company's balance sheet at Sept. 30, 2012, showed $2.76
million in total assets, $6.36 million in total liabilities and a
$3.60 million deficit.
XTREME IRON: Trustee Hires Litzler Segner as Accountants
--------------------------------------------------------
Areya Holder, the Chapter 11 trustee of Xtreme Iron, LLC, asks the
Bankruptcy Court for permission to employ Litzler, Segner, Shaw &
McKenney LLP as accountant for the estate.
The services to be provided by the firm's professionals will be
limited to the preparation of any tax returns and related matters.
The trustee attests the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
About Xtreme Iron
Xtreme Iron Holdings, LLC, filed a bare-bones Chapter 11 petition
(Bankr. N.D. Tex. Case No. 12-33832) in Dallas on June 13, 2012.
Lake Dallas-based Xtreme Iron Holdings estimated assets and
liabilities of $10 million to $50 million.
Xtreme Iron Holdings is the holding company for Xtreme Iron LLC --
http://www.xtreme-iron.com-- which claims to own one of the
largest heavy equipment rental fleets in the state of Texas.
Their fleet is comprised of late model, low hour Caterpillar and
John Deere equipment. Holdings said an estimated 90% of the
business assets are located in North Texas counties.
Xtreme Iron Hickory Creek LLC filed its own petition (Bankr. E.D.
Tex. Case No. 12-41750) on June 29, listing under $1 million in
both assets and debts.
Xtreme Iron LLC commenced Chapter 11 proceedings (Bankr. N.D. Tex.
Case No. 12-34540) almost a month later, on July 11, estimating
assets and debts of $10 million to $50 million.
Judge Harlin DeWayne Hale oversees the Chapter 11 cases of
Holdings and Iron LLC. Gregory Wayne Mitchell, Esq., at The
Mitchell Law Firm, L.P., serves as bankruptcy counsel to all three
Debtors.
On Sept. 14, 2012, Areya Holder was appointed Chapter 11 Trustee
of the estates of Xtreme Iron Holdings, LLC, and Xtreme Iron, LLC.
Gardere Wynne Sewell LLP serves as counsel for Areya Holder.
Beta Capital LLC, a creditor, has asked the Bankruptcy Court in
Dallas to transfer the venue of Holdings' Chapter 11 case to the
Bankruptcy Court for the Eastern District of Texas, saying the
company's domicile, residence, principal place of business, and
the location of its principal assets are all in the Eastern
District; and venue is not proper in the Northern District of
Texas.
* Fitch Says Modified Mortgages Still Pose Credit Risks for Banks
-----------------------------------------------------------------
Improving conditions in the U.S. housing market and modest
declines in foreclosure activity have yet to translate into a
material reduction in credit risk for residential mortgages that
have been modified since 2008, according to Fitch. Weak asset
quality trends, particularly for loans modified in the 2008-2010
period, continue to support our view that troubled debt
restructurings (TDRs) should be included in Fitch-calculated
nonperforming asset (NPA) metrics.
Fitch says: "While U.S. loan servicers continued to report
somewhat better modification results through the third quarter of
2012, in part as a result of payment reductions negotiated under
the government's Home Affordable Modification Program (HAMP), we
regard the high delinquency and foreclosure rates for recently
modified mortgages as reflective of still elevated residential
mortgage asset quality problems. Furthermore, opaque and
inconsistent disclosure practices by large servicers make it
difficult to assess the underlying asset quality of the modified
loans for individual institutions.
"The OCC's most recent survey of performance data for loans
serviced by selected national and federal savings banks
(accounting for 57% of all U.S. residential mortgages) indicated
that 10.6% of all serviced mortgages were not current as of
Sept. 30, 2012. Particularly for older vintage (pre-2011) loans,
the total share of modified mortgages that were in some stage of
delinquency or in the foreclosure process remained at very high
levels. According to the OCC breakdown of asset quality, 2.9% of
all loans were 30-59 days past due, while 4.4% were "seriously
delinquent" (60 days or more past due). The share of OCC-surveyed
loans at some stage of foreclosure as of 3Q12 was 3.3%.
"Ongoing asset quality challenges made clear in the OCC data
highlight the need for better public disclosure by servicers of
underlying post-modification mortgage performance. Reporting
practices remain inconsistent, and banks may apply different
standards in reporting the level of TDR activity in any period.
Their disclosures of payment default activity may differ, and
breakouts of non-performing loans after modifications have been
made can vary significantly.
"As we noted in our December 2011 report "Troubled Debt
Restructurings: First Look at Re-Default Rates and Disclosures,"
banks are only required to disclose the number and value of TDRs
that had "payment defaults" within 12 months of classification as
a TDR. As a result, performance data beyond the 12-month period
are not available at the bank level, and banks' classification of
defaults may vary.
"The OCC data point to the still uneven track record of mortgage
modification efforts. Performance has only been publicly disclosed
in the OCC report since 2008. Since that time, however, only 47.7%
of the 2.9 million modified loans in the survey were either
current or paid off as of 3Q12. The remainder were split between
some stage of delinquency (21.3%), foreclosed or in the
foreclosure process (15.0%), or no longer in the servicer's
portfolio (16.1%).
"Despite incremental progress toward a stabilization of TDR asset
quality, the overall picture points to a continuation of broadly
weak asset performance in mortgage portfolios, especially for
those large regional banks and global trading institutions that
together hold approximately 91% of all accruing TDRs for U.S.
banks rated by Fitch. We believe that inclusion of accruing TDRs
in NPA calculations remains the best approach, since mortgage
asset quality is still weighing heavily on overall NPA ratios for
the large banks."
* Circuit Upholds Ruling Knocking Out Education Loan
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when a bankruptcy court ruled that a student loan had
been paid in full, the lender couldn't attempt to collect the debt
later, contending the bankruptcy court hadn't properly ruled on
whether the debt was discharged in bankruptcy. The Bankruptcy
Appellate Panel for the First Circuit upheld the bankruptcy court,
as did the U.S. Court of Appeals in Boston in a March 29 opinion.
The appeals court said the bankruptcy judge wasn't required to
decide if the student loan was dischargeable when the question was
whether the debt had been paid. The case is Hann v. Educational
Credit Management Corp. (In re Hahn), 12-9006, First U.S. Circuit
Court of Appeals (Boston).
* Libor Suits by Bondholders Tossed Over Lack of Damages
--------------------------------------------------------
David Glovin, writing for Bloomberg News, reported that banks
including Bank of America Corp. (BAC), Barclays Plc (BARC) and
JPMorgan Chase & Co. (JPM) won dismissal of antitrust lawsuits by
plaintiffs claiming they were harmed by the rigging of the London
interbank offered rate.
Bloomberg related that in more than two dozen interrelated cases
before U.S. District Judge Naomi Reice Buchwald in New York, the
banks were alleged to have conspired to depress Libor by
understating their borrowing costs, thereby lowering their
interest expenses on products tied to the rates.
While potential damages were estimated to be in the billions of
dollars, the judge ruled the cases must be dismissed because of
the inability of litigants that included brokerage Charles Schwab
Corp. (SCHW), pension funds and other bondholders to show they
were harmed, the Bloomberg report further related. Buchwald,
whose March 29 ruling allowed some commodities-manipulations
claims to proceed to a trial, said that, while private plaintiffs
must show actual harm, her ruling didn't impede governments from
pursuing antitrust claims tied to attempts to manipulate Libor.
"We recognize that it might be unexpected that we are dismissing a
substantial portion of plaintiffs' claims, given that several of
the defendants here have already paid penalties to government
regulatory agencies reaching into the billions of dollars,"
Buchwald wrote, according to Bloomberg. "There are many
requirements that private plaintiffs must satisfy but which
government agencies need not."
The consolidated case is In re Libor-Based Financial Instruments
Antitrust Litigation, 11-MD-02262, U.S. District Court, Southern
District of New York (Manhattan).
* S&P Case Should Stay in Connecticut Court, U.S. Says
------------------------------------------------------
Don Jeffrey, writing for Bloomberg News, reported that McGraw-Hill
Cos. (MHP)' Standard & Poor's unit shouldn't be allowed to move
Connecticut's lawsuit over ratings of securities to a federal
court, the U.S. argued in a court filing.
The Bloomberg report related that McGraw-Hill, based in New York,
filed so-called notices of removal in several courts to put the
cases by Connecticut and other states under federal jurisdiction
and combine them for pretrial matters, such as the exchange of
evidence and questioning of witnesses.
"It is tempting to find federal jurisdiction every time a
multibillion-dollar case with national implications arrives at the
doorstep of a federal court," the U.S. said in its filing in
federal court in New Haven, Connecticut, the report cited. "The
jurisdiction of the federal district courts, however, is left to
Congress, not to the discretion of the courts themselves."
The lawsuits, according to Bloomberg, filed by the attorneys
general of 16 states and the District of Columbia, claim S&P
violated state consumer- protection and unfair-trade-practices
statues. The U.S., in a lawsuit filed in federal court in Los
Angeles, accuses S&P of inflating ratings on mortgage-backed
securities and collateralized debt obligations.
McGraw-Hill argued in the Connecticut case that state-court action
on the claims would "disrupt and supplant" regulation of S&P by
the U.S. Securities and Exchange Commission, the report related.
McGraw- Hill also argued that the claims test the boundaries of
the free-speech rights of the First Amendment to the U.S.
Constitution, which is a federal defense.
The Connecticut case is Connecticut v. McGraw-Hill Cos., 13-00311,
U.S. District Court, District of Connecticut (New Haven). The U.S.
case is U.S. v. McGraw-Hill Cos., 13-cv-00779, U.S. District
Court, Central District of California (Los Angeles).
* Merrill Sued for $309 Million by Trust over Mortgages
-------------------------------------------------------
Chris Dolmetsch, writing for Bloomberg News, reported that a unit
of Bank of America Corp.'s Merrill Lynch was sued by a trust
seeking more than $309 million in damages for alleged breaches of
representations and warranties related to the sale of more than
5,000 mortgages.
The trust filed the lawsuit in New York State Supreme Court in
Manhattan, accusing Merrill Lynch Mortgage Lending of failing to
buy back loans as required by agreements reached in 2007, the
Bloomberg report related citing a court filing.
The trust, Bloomberg said, also accused Merrill Lynch and H&R
Block Inc. (HRB)'s Sand Canyon unit of breaching similar
representations and warranties made about other mortgage loans.
Sand Canyon, formerly known as Option One Mortgage Corp., stopped
originating mortgage loans in December 2007, sold its servicing
assets to American Home Mortgage Servicing, and discontinued
remaining operations in April 2008.
Bloomberg related that Merrill Lynch in or about 2007 securitized
more than 5,900 residential mortgage loans from two separate
originators to serve as the basis for securities sold to
investors, the trust said in the court filing. The loans were
eventually sold to Merrill Lynch Mortgage Investors and then
conveyed to the trust, which were then sold to investors.
"Merrill Lynch and Sand Canyon both breached the above- referenced
representations and warranties," the trust said in the suit,
according to Bloomberg. "For example, information supplied by the
trustee reveals that over 180 mortgage loans were delinquent as of
the applicable cut-off date and/or the date of the closing of the
certificates to the public. These breaches have not been remedied
by Merrill Lynch or Sand Canyon."
The suit also accuses trustee Citibank N.A. of not taking
enforcement actions with respect to the alleged breaches.
Lawrence Grayson, a spokesman for Charlotte, North Carolina-based
Bank of America, declined to comment on the lawsuit, the report
added.
The case is MGRID LLC v. Merrill Lynch Mortgage Lending Inc.,
651140/2013, New York State Supreme Court (Manhattan).
* Pay for Boards at Banks Soars Amid Cutbacks
---------------------------------------------
Susanne Craig, writing for The New York Times' DealBook, reported
that Wall Street pay, while lucrative, isn't what it used to be --
unless you are a board member.
The DealBook report said since the financial crisis, compensation
for the directors of the nation's biggest banks has continued to
rise even as the banks themselves, facing difficult markets and
regulatory pressures, are reining in bonuses and pay.
Take Goldman Sachs, where the average annual compensation for a
director -- essentially a part-time job -- was $488,709 in 2011,
the last year for which data is available, up more than 50 percent
from 2008, according to Equilar, a compensation data firm, the
DealBook cited. Some of the firm's 13 directors make more than
$500,000 because they have extra responsibilities and those
numbers are likely to skyrocket for 2012 because the firm's shares
rose more than 35 percent last year and its directors are paid in
stock. Goldman Sachs is expected to release fresh pay data in the
coming weeks, according to the DealBook.
Goldman's board is the best compensated of any big American bank
and the fifth-highest paid of any company in the country,
according to Equilar, the DealBook related. Some of its rivals
are not that far behind. The nation's biggest banks paid their
directors over $95,000 a year more on average in 2011 than what
other large corporations paid. Goldman defends the board's pay,
saying that the bulk of the compensation is in stock that
directors cannot touch until after they have left the board. That
arrangement, the firm says, aligns directors' interests with those
of shareholders, the DealBook further related.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Apr. 10-12, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Chicago, Chicago, Ill.
Contact: http://www.turnaround.org/
Apr. 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
June 13-16, 2013
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Mich.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 11-13, 2013
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Hyatt Regency Newport, Newport, R.I.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 8-10, 2013
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 22-24, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
Nov. 1, 2013
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Atlanta Marriott Marquis, Atlanta, Ga.
Contact: 1-703-739-0800; http://www.abiworld.org/
Dec. 2, 2013
BEARD GROUP, INC.
20th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York, N.Y.
Contact: 240-629-3300 or http://bankrupt.com/
Dec. 5-7, 2013
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Terranea Resort, Rancho Palos Verdes, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via
e-mail to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors" Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., 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
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
*** End of Transmission ***