/raid1/www/Hosts/bankrupt/TCR_Public/130507.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, May 7, 2013, Vol. 17, No. 125
Headlines
06-019 VACAVILLE: Case Summary & Largest Unsecured Creditor
135 ESSTON: Voluntary Chapter 11 Case Summary
1ST FINANCIAL: Reports $221,000 Net Income in First Quarter
669 EAST 21: Voluntary Chapter 11 Case Summary
AMERICAN AIRLINES: UST Opposes Fees for Rothschild and Moelis
AVIATION SOFTWARE: Case Summary & 20 Largest Unsecured Creditors
BALLARD POWER: Incurs $8.4-Mil. Net Loss in First Quarter
BEAZER HOMES: Incurs $19.6 Million Net Loss in Second Quarter
BERNARD L. MADOFF: Trustee Appeals NY AG's Accord With Merkin
BERGENFIELD SENIOR HOUSING: Files for Chapter 11 in Newark
BERGENFIELD SENIOR HOUSING: Case Summary & 15 Unsecured Creditors
BG MEDICINE: Amends Third Quarter 2012 Form 10-Q
BIRDSALL SERVICES: Trustee Finds Similar Company to Be Buyer
BORN AGAIN: Case Summary & 6 Unsecured Creditors
BOUNDARY BAY: Plan Confirmation Hearing Continued to June 5
BRONX RMT: Case Summary & 2 Unsecured Creditors
CAESARS ENTERTAINMENT: S&P Lowers Corp. Credit Rating to 'CCC+'
CARRIAGE SERVICES: S&P Withdraws 'B' Corporate Credit Rating
CATALYST PAPER: Posts $9.8-Mil. Net Loss in First Quarter 2013
CELL THERAPEUTICS: Incurs $19.4-Mil. Net Loss in First Quarter
CENTRAL EUROPEAN: Further Amends Securities Purchase Agreement
CHARLOTTE RUSSE: Moody's Rates New $150MM Senior Term Loan 'B2'
CHESTER DOWNS: S&P Lowers Corporate Credit Rating to 'CCC+'
CHINESEWORLDNET.COM INC: Incurs US$129K Net Loss in 2012
CITRUS MEMORIAL: Fitch Lowers Rating on $38.4-Mil. Bonds to 'B'
CLEAR CHANNEL: Incurs $203 Million Net Loss in First Quarter
CLEARWIRE CORP: Mails Letter to Shareholders on Sprint Deal
CNO FINANCIAL: S&P Raises Issuer Credit Rating to 'BB-'
CODA HOLDINGS: Wins Interim Approval of $5MM DIP Financing
CODA HOLDINGS: Hearing on Rules for Fortress-Led Auction May 20
CODA HOLDINGS: Sec. 341 Meeting of Creditors on June 3
CODA HOLDINGS: Wins Approval to Hire KCC as Claims Agent
CROWN MEDIA: Reports $14.5 Million Net Income in First Quarter
DYNASTY HOTEL: Case Summary & 20 Largest Unsecured Creditors
EASTMAN KODAK: Formal Claim-Resolution Procedures Approved
ELBIT IMAGING: Delays Form 20-F for 2012
EMMONS-SHEEPSHEAD: June 27 Plan Confirmation Hearing Set
ENERGY FUTURE: Incurs $569 Million Net Loss in First Quarter
ENERGY TRANSFER: Fitch Raises Senior Secured Debt Ratings to 'BB'
EXCEL MARITIME: Lenders Extend Forbearance Until May 31
EXIDE TECHNOLOGIES: S&P Lowers Corp. Credit Rating to 'CCC+'
FIRST DATA: Names Frank Bisignano Chief Executive Officer
FIRST QUALITY: Moody's Gives B2 CFR & Rates $500MM Unsec. Notes B2
FIRST QUALITY: S&P Assigns BB CCR & Rates $500MM Unsec. Notes BB-
FLAT OUT CRAZY: Restaurant Sales Approved; Exclusivity Sought
FONTAINEBLEAU LAS VEGAS: NY Judge Ships BofA's Doc Spat to Fla.
FREESEAS INC: Issues Add'l 325,000 Settlement Shares to Hanover
GASCO ENERGY: Common Stock Trades on OTCQB Marketplace
GATEHOUSE MEDIA: Incurs $17.6 Million Net Loss in First Quarter
GENMAR HOLDINGS: 8th Cir. Tosses David Scot Lynd's Appeal
GGW BRANDS: 'Girls Gone Wild' Trustee Gets Subpoena Power
GLOBAL GREEN: Incurs C$469K Net Loss in Fiscal 3rd Quarter
GULF FLEET: Trustee Can Recover $9,105 Transfer to Southern Crane
HAMPTON LAKE: Hilton Head Project Files for Ch. 11 With Plan
HAMPTON LAKE: Case Summary & 20 Largest Unsecured Creditors
HAMPTON ROADS: Robin Gregory Joins as East Bank Manager
HARRISBURG, PA: SEC Charges for Fraudulent Public Statements
HARVEST NATURAL: PwC LLP Raises Going Concern Doubt
HAWAII OUTDOOR: May 20 Hearing on Cash Use, Case Trustee
J.M. TENDALL: Case Summary & 4 Largest Unsecured Creditors
JENROB PROPERTIES: Voluntary Chapter 11 Case Summary
K-V PHARMACEUTICAL: Will Pursue Investors' Alternative Ch. 11 Plan
KINGSBURY CORP: Files Liquidating Plan, To Sell Real Estate
KREISS ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors
LEASEMOBILE OF SONORA: Voluntary Chapter 11 Case Summary
LIFECARE HOLDINGS: Revolving Loan Agreement Approval Sought
LEHMAN BROTHERS: Sues to Slash Syncora's $1.3B Mortgage Note Claim
LKS CONCEPTS: Case Summary & 8 Unsecured Creditors
MASTRO'S RESTAURANT: S&P Lowers Corp. Credit Rating to 'SD'
MAXCOM TELECOMUNICACIONES: May File for Bankruptcy by June 15
MERUELO MADDUX: Rejection of Belinda Meruelo Claim Affirmed
MERUELO MADDUX: Former Exec Clears Hurdle to Seek Defense Costs
MF GLOBAL: Coe Defends Self From Monetary Sanction
MGM RESORTS: Reports $6.5 Million Net Income in First Quarter
NATIONAL BANK OF GREECE: Incurs EUR2.52-Bil. Net Loss in 2012
NITRO PETROLEUM: Montomery Coscia Raises Going Concern Doubt
NORTHLAND RESOURCES: Bondholders Back Restructuring Proposal
NXT ENERGY: Reports CR$2.1-Mil. Net Income in 2012
OCALA FUNDING: FDIC Looks to Gut BofA's $2-Bil. Suit Over Fraud
OMEGA NAVIGATION: Further Modifies Liquidating Plan
ORANGE GROVE: Case Summary & 20 Largest Unsecured Creditors
ORCKIT COMMUNICATIONS: Redemption of $5MM Secured Noted Okayed
OVERSEAS SHIPHOLDING: Affiliates File Assets & Debts Schedules
PACIBEL LLC: Case Summary & Largest Unsecured Creditor
PACKAGING DYNAMICS: Paper Unit Divestiture No Impact on B2 CFR
PANDA TEMPLE II: S&P Rates First Lien $372-Mil. Term Loan 'B'
PARADISE VALLEY: Plan Outline Has Conditional Approval
PARK CITY: Case Summary & 2 Unsecured Creditors
PATRIOT COAL: MSHA Vacates Imminent Danger Order vs. Remington
PBG PROPERTIES: Case Summary & 4 Largest Unsecured Creditors
PENSACOLA BEACH: Files for Chapter 11 in Florida
PENSACOLA BEACH: Case Summary & 20 Largest Unsecured Creditors
PHYSIOTHERAPY ASSOCIATES: Default Cues Moody's to Cut CFR to Caa3
POWER BUYER: S&P Retains Prelim. 'B' Rating After Loan Upsizing
POWERWAVE TECHNOLOGIES: KEIP Approval Sought
PRIMECARE MEDICAL: Moody's Places 'Ba2' IFS on Review for Upgrade
QUALITY DISTRIBUTION: Reports $9.1 Million Net Income in Q1
RAHA LAKES: Plan Disclosures Need More Info on Funding
REGIONALCARE HOSPITAL: Loan Increase No Impact on Moody's B3 CFR
RESIDENTIAL CAPITAL: Chief Executive Tom Marano Steps Down
RG STEEL: GEM Wants Sale Order Revised to Remove, Sell Mill Steel
ROTECH HEALTHCARE: Shareholders Defend Creation of Equity Panel
SAN BERNARDINO, CA: Residents Launch Council Recall
SERRON INVESTMENTS: Case Summary & 2 Largest Unsecured Creditors
SHILO INN: Updated Case Summary & Creditors' Lists
SIRIUS XM: $500-Mil. Debt Increase No Impact on Moody's Ratings
SIRIUS XM: S&P Assigns 'BB' Rating to $500MM Notes Due 2023
SIX FLAGS: Moody's Affirms 'B1' Corp. Family Rating
SPRING PLAN: Files Plan to Implement Settlement with Cantor
STANDARD STEEL: S&P Withdraws 'BB-' Corporate Credit Rating
STRATUM HOLDINGS: Incurs $92,000 Net Loss in 1st Quarter
SUBURBAN WEST: Case Summary & 20 Largest Unsecured Creditors
SUNSTONE COMPONENTS: Accedes to Bankruptcy to Sell Business
THQ INC: President's Bonus Opposed by U.S. Trustee
TIGAMAN INC: Case Summary & 2 Unsecured Creditors
TIMEGATE STUDIOS: Case Summary & 18 Largest Unsecured Creditors
TOMSTEN INC: Case Summary & 20 Largest Unsecured Creditors
TOP SHIPS: Lowers Net Loss to $64-Million in 2012
TRANSVANTAGE SOLUTIONS: In Chapter 11, Wants Ch.11 Trustee
TRANSVANTAGE SOLUTIONS: Proposes Cohn Bracaglia as Counsel
TRINITY COAL: Can Hire D.J. Geiger as Mining Consultant
TRINITY COAL: Panel Hires Foley & Lardner as Counsel
TRINITY COAL: Panel Hires Sturgill Turner as Attorneys
UNIVERSAL FINANCE: Case Summary & 20 Largest Unsecured Creditors
US MORTGAGE CORP: NJ Court Narrows Claims v. NFS & JP Turner
USEC INC: To Submit NYSE Listing Compliance Plan
VINAYAK PROPERTIES: Sarasota Airport Holiday Inn in Ch. 11
VINAYAK PROPERTIES: Case Summary & 20 Largest Unsecured Creditors
VITAMIN SHOPPE: S&P Assigns 'BB' CCR; Outlook Stable
VIVIANI FAMILY: Case Summary & 20 Largest Unsecured Creditors
VPR OPERATING: Files Schedules of Assets and Liabilities
WEST KENDALL: Can Pursue 2011 Suit v. Downrite, Fla. App. Ct. Says
WINSTAR COMMS: IDT Files for Spin-Off of Spectrum Licenses
WNA HOLDINGS: S&P Affirms 'B' CCR & Rates $500 Million Debt 'B'
WOOTON GROUP: Chapter 11 Status Conference Continued to June 19
XCELL ENERGY: Committee Can Hire Burr & Forman as Counsel
XCELL ENERGY: Can Hire Litzler Segner as Accountant
ZACKY FARMS: Poultry Farms Plan Set for June 25 Approval
ZHONE TECHNOLOGIES: Reports $230,000 Net Income in 1st Quarter
ZUERCHER TRUST: Ch.11 Trustee Can Hire Ezra Brutzkus as Counsel
* JPMorgan Caught in Swirl of Regulatory Woes
* Multi-Corp Signs Deal to Purchase Double X Property
* Regulators Scrutinize Auto Lenders over Add-Ons
* S&P Predicts No More Calif. Municipalities Bankruptcies
* Illinois House Passes Sweeping Pension Fix in Close Vote
* SAC to Begin Clawing Back Compensation in Insider Trading Cases
* SEC Zeroing In on "Prime" Funds
* April Bankruptcies in U.S. Showing Bottom or Uptick
* 9th Cir. Joins Circuit Split on Recharacterization Power
* Cadwalader Appoints New Partners to Financial Restructuring Team
* Large Companies With Insolvent Balance Sheets
*********
06-019 VACAVILLE: Case Summary & Largest Unsecured Creditor
-----------------------------------------------------------
Debtor: 06-019 Vacaville Iii Business Trust
6767 W. Tropicana Avenue, Suite 206
Las Vegas, NV 89103
Bankruptcy Case No.: 13-13810
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Linda B. Riegle
Debtor's Counsel: Timothy P. Thomas, Esq.
LAW OFFICES OF TIMOTHY P. THOMAS, LLC
8670 W. Cheyenne Avenue, #120
Las Vegas, NV 89129
Tel: (702) 227-0011
Fax: (702)227-0015
E-mail: TTHOMAS@TTHOMASLAW.COM
Scheduled Assets: $1,819,243
Scheduled Liabilities: $718,753
The petition was signed by Peter Becker, managing member of
trustee, Mesa Asset Managements, LLC.
Affiliates that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
05-023 Carmencita Business Trust 13-11150 02/15/13
05-023 Redding Business Trust 13-11151 02/15/13
06-009 Ranco Coachella Business Trust 13-13423 04/22/13
The Company's list of its largest unsecured creditors filed with
the petition contains only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Mesa Asset Management, LLC Loans $8,350
6767 W. Tropicana, Suite 206
Las Vegas, NV 89103
135 ESSTON: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: 135 Esston Inc.
3139 Fulton Street
Brooklyn, NY 11208
Bankruptcy Case No.: 13-42639
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Nancy Hershey Lord
Debtor's Counsel: Heath S. Berger, Esq.
BERGER, FISCHOFF & SHUMER, LLP
40 Crossways Park Drive
Woodbury, NY 11797
Tel: (516)747-1136
Fax: (516)747-0382
E-mail: hberger@sfbblaw.com
Scheduled Assets: $1,155,000
Scheduled Liabilities: $1,445,275
The Company's list of its largest unsecured creditors does not
contain any entry.
The petition was signed by Chief Samsair, president.
1ST FINANCIAL: Reports $221,000 Net Income in First Quarter
-----------------------------------------------------------
1st Financial Services Corporation filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing net income available to common stockholders of $221,000
on $5.98 million of total interest income for the three months
ended March 31, 2013, as compared with net income available to
common stsockholders of $330,000 on $6.54 million of total
interest income for the same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $697.46
million in total assets, $677.74 million in total liabilities and
$19.72 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/R5hSbc
About 1st Financial
Hendersonville, North Carolina-based 1st Financial Services
Corporation is the bank holding company for Mountain 1st Bank &
Trust Company. 1st Financial has essentially no other assets or
liabilities other than its investment in the Bank. 1st
Financial's business activity consists of directing the activities
of the Bank. The Bank has a wholly owned subsidiary, Clear Focus
Holdings LLC.
The Bank was incorporated under the laws of the state of North
Carolina on April 30, 2004, and opened for business on May 14,
2004, as a North Carolina chartered commercial bank. At Dec. 31,
2011, the Bank was engaged in general commercial banking primarily
in nine western North Carolina counties: Buncombe, Catawba,
Cleveland, Haywood, Henderson, McDowell, Polk, Rutherford, and
Transylvania. The Bank operates under the banking laws of North
Carolina and the rules and regulations of the Federal Deposit
Insurance Corporation (the FDIC).
As a North Carolina bank, the Bank is subject to examination and
regulation by the FDIC and the North Carolina Commissioner of
Banks. The Bank is further subject to certain regulations of the
Federal Reserve governing reserve requirements to be maintained
against deposits and other matters. The business and regulation
of the Bank are also subject to legislative changes from time to
time.
The Bank's primary market area is southwestern North Carolina.
Its main office and Hendersonville South office are located in
Hendersonville, North Carolina. At Dec. 31, 2011, the Bank also
had full service branch offices in Asheville, Brevard, Columbus,
Etowah, Forest City, Fletcher, Hickory, Marion, Shelby, and
Waynesville, North Carolina. The Bank's loans and deposits are
primarily generated from within its local market area.
1st Financial disclosed net income of $1.27 million in 2012, as
compared with a net loss of $20.47 million in 2011.
Elliott Davis, PLLC, in Greenville, South Carolina, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2012. The independent
auditors noted that the Company has suffered recurring losses that
have eroded regulatory capital ratios, and the Company's wholly
owned subsidiary, Mountain 1st Bank & Trust Company, is under a
regulatory Consent Order with the Federal Deposit Insurance
Corporation and the North Carolina Commissioner of Banks that
requires, among other provisions, capital ratios to be maintained
at certain heightened levels. In addition, the Company is under a
written agreement with the Federal Reserve Bank of Richmond that
requires, among other provisions, the submission and
implementation of a capital plan to improve the Company and the
Bank's capital levels. As of Dec. 31, 2012, both the Bank and the
Company are considered "significantly undercapitalized" based on
their respective regulatory capital levels. These considerations
raise substantial doubt about the Company's ability to continue as
a going concern.
669 EAST 21: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: 669 East 21 LLC
669 East 21st Street
Brooklyn, NY 11226
Bankruptcy Case No.: 13-42614
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Elizabeth S. Stong
Debtor's Counsel: David Carlebach, Esq.
40 Exchange Place, Suite 1306
New York, NY 10005
Tel: (212) 785-3041
Fax: (646) 355-1916
E-mail: david@carlebachlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Ann Einhorn, managing member.
AMERICAN AIRLINES: UST Opposes Fees for Rothschild and Moelis
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when AMR Corp. is in bankruptcy court on May 9 for
approval of $3.25 billion new financing, the parent of American
Airlines Inc. will face little in the way of objection to the loan
itself. On the other hand, the U.S. Trustee is opposing
$15 million in fees for AMR's financial advisers Rothschild Inc.
and Moelis & Co.
According to the report, the new loan will consist of a
$2.25 billion term loan and a $1 billion revolving credit, secured
by AMR's airport gates, slots at congested airports, and some
international routes. Technical objections to the loan itself
seek to ensure that the new loan doesn't infringe on existing
collateral rights or rights of airport owners.
The report relates that the U.S. Trustee contends that the court-
approved fee arrangements for Rothschild and Moelis already cover
new loans such as the one up for approval May 9. The bankruptcy
watchdog for the Justice Department says that the "generous fee
arrangements" already included securing new capital, meaning that
additional fees are "not warranted."
If putting together the new loan was outside the initial fee
arrangements, the U.S. Trustee says the prior fee arrangements
haven't been shown to be "improvident."
Rothschild's original fee arrangement calls for a $200,000 monthly
fee, a $15 million completion fee, and a fee for raising new
capital. For Moelis, the monthly fee is $175,000, plus a
$7.5 million restructuring fee offset by half the monthly fees.
AMR's reorganization is in the homestretch, with a May 30 hearing
for approval of disclosure materials explaining the reorganization
plan based on a merger with US Airways Group Inc. Creditors are
to be paid in full with stock in the merged airlines.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
The Retiree Committee is represented by Jenner & Block LLP's
Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B.
Hankin, Esq.
AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AVIATION SOFTWARE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Aviation Software, Inc.
215 Airport Executive Park
Nanuet, NY 10954
Bankruptcy Case No.: 13-22702
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Southern District of New York (White Plains)
Judge: Robert D. Drain
Debtor's Counsel: Michael A. Koplen, Esq.
LAW OFFICES OF MICHAEL A. KOPLEN
14 South Main Street, Suite 4
New City, NY 10956
Tel: (845) 623-7070
Fax: (845) 708-5597
E-mail: Atty@KoplenLawFirm.com
Estimated Assets: $50,001 to $100,000
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/nysb13-22702.pdf
The petition was signed by Gordon S. Rosen, president.
BALLARD POWER: Incurs $8.4-Mil. Net Loss in First Quarter
---------------------------------------------------------
Ballard Power Systems Inc. reported a net loss of US$8.4 million
on US$12.3 million of revenues for the three months ended March
31, 2013, compared with a net loss of $8.5 million on $10.1
million of revenues for the same period a year ago.
The Company's balance sheet at Dec. 31, 2012, showed
US$130.5 million in total assets, US$67.9 million in total
liabilities, and stockholders' equity of US$62.6 million.
A copy of the Company's First Quarter 2013 Financial Statements is
available at http://is.gd/B7oNTU
A copy of the Company's First Quarter 2013 Management's Discussion
and Analysis is available at http://is.gd/sRhBVT
Ballard Power Systems Inc. (NASDAQ: BLDP)(TSX: BLD), located in
Burnaby, Canada, provides clean energy fuel cell products enabling
optimized power systems for a range of applications.
* * *
As reported in the TCR on Feb. 25, 2013, KPMG LLP, in Vancouver,
Canada, said the Company's ability to continue as a going concern
and realize its assets and discharge its liabilities and
commitments in the normal course of business is dependent on it
having sufficient liquidity and achieving profitable operations
that are sustainable. "These conditions indicate the existence of
a material uncertainty that casts substantial doubt about the
Company's ability to continue as a going concern."
BEAZER HOMES: Incurs $19.6 Million Net Loss in Second Quarter
-------------------------------------------------------------
Beazer Homes USA, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $19.64 million on $287.90 million of total revenue
for the three months ended March 31, 2013, as compared with a net
loss of $39.94 million on $191.64 million of total revenue for the
same period during the prior year.
For the six months ended March 31, 2013, the Company incurred a
net loss of $40.02 million on $534.80 million of total revenue, as
compared with a net loss of $39.21 million on $380.19 million of
total revenue for the same period a year ago.
The Company's balance sheet at March 31, 2013, showed $1.94
billion in total assets, $1.71 billion in total liabilities and
$233.23 million in total stockholders' equity.
"I'm pleased with our solid operational and financial performance
this quarter," said Allan Merrill, CEO of Beazer Homes.
"Improvements in closings, average sales price and gross margins
enabled us to generate $15 million in adjusted EBITDA, the highest
amount for our fiscal second quarter since 2007. With a
substantially higher backlog, improving margins and tight control
of fixed costs, we expect to report positive net income for our
fiscal fourth quarter, which should allow us to be profitable for
the second half of fiscal 2013."
A copy of the Form 10-Q is available for free at:
http://is.gd/FQYAB4
About Beazer Homes
Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/--
headquartered in Atlanta, is one of the country's 10 largest
single-family homebuilders with continuing operations in Arizona,
California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada,
New Jersey, New Mexico, North Carolina, Pennsylvania, South
Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed
on the New York Stock Exchange under the ticker symbol "BZH."
Beazer Homes incurred a net loss of $145.32 million for the fiscal
year ended Sept. 30, 2012, a net loss of $204.85 million for the
fiscal year ended Sept. 30, 2011, and a net loss of $34.04 million
for the fiscal year ended Sept. 30, 2010.
* * *
Beazer carries a 'B-' issuer credit rating, with "negative"
outlook, from Standard & Poor's.
In the Jan. 30, 2013, edition of the TCR, Moody's Investors
Service raised Beazer Homes USA, Inc.'s corporate family rating to
Caa1 from Caa2 and probability of default rating to Caa1-PD from
Caa2-PD. The ratings upgrade reflects Moody's increasing
confidence that Beazer's credit metrics, buoyed by a stregthening
housing market, will gradually improve for at least the next two
years and that the company may be able to return to a modestly
profitable position as early as fiscal 2014.
As reported by the TCR on Sept. 10, 2012, Fitch Ratings has
upgraded the Issuer Default Rating (IDR) of Beazer Homes USA, Inc.
(NYSE: BZH) to 'B-' from 'CCC'. The upgrade and the Stable
Outlook reflect Beazer's operating performance so far this year,
its robust cash position, and moderately better prospects for the
housing sector during the remainder of this year and in 2013. The
rating is also supported by the company's execution of its
business model, land policies, and geographic diversity.
BERNARD L. MADOFF: Trustee Appeals NY AG's Accord With Merkin
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee liquidating Bernard L. Madoff Investment
Securities LLC is appealing to the U.S. Court of Appeals from a
federal district judge's ruling in April that he has no right to
bar New York Attorney General Eric Schneiderman from completing a
$410 million settlement with feeder fund manager J. Ezra Merkin.
The report recounts that U.S. District Judge Jed Rakoff threw out
the lawsuit, saying Madoff trustee Irving Picard waited too long
before trying to stop the settlement of a state-court lawsuit the
attorney general commenced in April 2009. Judge Rakoff also
concluded that Mr. Picard had no right to halt the settlement
because no property of the bankrupt estate was involved to invoke
the so-called automatic stay.
According to the report, Mr. Picard wants to stop the settlement
for fear paying $410 million will leave Mr. Merkin without enough
cash to pay judgments in the trustee's own suit against the
feeder-fund manager. Mr. Picard also argued, unsuccessfully, that
the $410 million should go to him because it represents money
stolen from Madoff customers.
The dispute with Schneiderman in district Court is Mr. Picard v.
Schneiderman, 12-cv-06733, U.S. District Court, Southern District
New York (Manhattan). The lawsuit with Schneiderman in bankruptcy
court is Picard v. Schneiderman, 12-01778, U.S. Bankruptcy Court,
Southern District of New York (Manhattan).
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.).
Mr. Picard has made three distributions, paying more than half of
smaller claims in full and satisfying just over 50 percent of
larger customer claims totaling more than $17 billion.
BERGENFIELD SENIOR HOUSING: Files for Chapter 11 in Newark
----------------------------------------------------------
Bergenfield Senior Housing, LLC, filed a Chapter 11 bankruptcy
petition (Bankr. D.N.J. Case No. 13-19703) in Newark, New Jersey,
on May 2, 2013.
The Bergenfield, New Jersey-based debtor is a single asset real
estate under 11 U.S.C. Sec. 101(51B) and said total assets and
debts exceed $10 million.
The Debtor said in court filings that it is filing for protection
under Chapter 11 of the Bankruptcy Code to preserve the assets of
BSH and/or to effectuate a sale of BSH's assets for the benefit of
its creditors and other parties in interest.
The Debtor filed an application to employ McElroy, Deutsch,
Mulvaney & Carpenter LLP as general bankruptcy counsel to
represent and assist BSH in carrying out its duties under the
Bankruptcy Code.
The current rates for MDMC professionals range from partner
$275 to $550, of counsel $260 to $475, associates $175 to $300 and
paralegals at $75 to $210. The current rates of the attorneys
expected to have primary responsibility for this matter are $525
for partner Barry Kleban and $250 for associate Aaron Applebaum.
The law firm disclosed that it represents Boiling Spring Savings
Bank, the Debtor's principal secured creditor, in matters
unrelated to the Chapter 11 case and the Debtor. MDMC believes
that it is a "disinterested person" under 11 U.S.C. Sec. 101(14).
BERGENFIELD SENIOR HOUSING: Case Summary & 15 Unsecured Creditors
-----------------------------------------------------------------
Debtor: Bergenfield Senior Housing, LLC
47 Legion Drive
Bergenfield, NJ 07621
Bankruptcy Case No.: 13-19703
Chapter 11 Petition Date: May 2, 2013
Court: U.S. Bankruptcy Court
District of New Jersey (Newark)
Judge: Morris Stern
Debtor's Counsel: Aaron Solomon Applebaum, Esq.
MCELROY, DEUTSCH, MULVANEY & CARPENTER, LLP
1617 John F. Kennedy Boulevard, Suite 1500
Philadelphia, PA 19103
Tel: (215) 557-2956
Fax: (215) 557-2990
E-mail: aapplebaum@mdmc-law.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Nicholas Rotonda, member/manager.
Debtor?s List of Its 15 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
SM Global Group, LLC Judgment $1,860,000
c/o Edward Sun Kiel, Esq.
Cole Schotz
Court Plaza North
25 Main Street
Hackensack, NJ 07601
System Designs -- $12,788
300 Lackawanna Avenue, Suite 004
Woodland Park, NJ 07424
Piekarsky & Associate, L.L.C. -- $5,000
Grace Building
191 Godwin Avenue, Suite 1
Wyckoff, NJ 07481
PSE&G -- $4,064
Harleysville Insurance -- $2,772
United Water -- $1,815
BankDirect Capital Finance -- $1,314
Davis Carburetor & Electric -- $1,640
Verizon -- $549
Buldo Carting, Inc. -- $545
Arrow Elevator of New Jersey -- $400
Poland Spring -- $16
Staples, Inc. -- Undetermined
Lowe?s -- Undetermined
Home Depot Credit Services -- Undetermined
BG MEDICINE: Amends Third Quarter 2012 Form 10-Q
------------------------------------------------
BG Medicine, Inc., has amended its quarterly report for the period
ended Sept. 30, 2012, solely for the purpose of amending exhibit
10.2 under Item 6 of Part II of the original report. No other
changes have been made to the Original Report and the amendment
does not modify or update disclosures in the Original Report. A
copy of the Amended Form 10-Q is available for free at:
http://is.gd/duEcYc
About BG Medicine
Waltham, Mass.-based BG Medicine is a diagnostics company focused
on the development and commercialization of novel cardiovascular
diagnostic tests to address significant unmet medical needs,
improve patient outcomes and contain healthcare costs. The
Company is currently commercializing two diagnostic tests, the
first of which is the BGM Galectin-3 test, a novel assay for
measuring galectin-3 levels in blood plasma or serum for use as an
aid in assessing the prognosis of patients diagnosed with heart
failure. The Company's second diagnostic test is the CardioSCORE
test, which is designed to identify individuals at high risk for
near-term, significant cardiovascular events, such as heart attack
and stroke.
BG Medicine reported a net loss of $23.8 million in 2012, compared
with a net loss of $17.6 million in 2011. The Company's balance
sheet at Dec. 31, 2012, showed $15.2 million in total assets,
$14.9 million in total liabilities, and stockholders' equity of
$309,000.
"We expect to incur further losses in the commercialization of our
cardiovascular diagnostic test and the operations of our business
and have been dependent on funding our operations through the
issuance and sale of equity securities. These circumstances may
raise substantial doubt about our ability to continue as a going
concern," according to the Company's annual report for the period
ended Dec. 31, 2012.
BIRDSALL SERVICES: Trustee Finds Similar Company to Be Buyer
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee for Birdsall Services Group Inc. found a
purchaser to buy the indicted engineering firm for $5.6 million
cash plus contingent payments.
According to the report, Mr. Stier identified a similar company
named Partner Assessment Corp. as the potential buyer with the
best offer so far. For existing projects, work in process and
accounts receivable, Partner Assessment will pay $5.6 million
cash, adjusted for the amount of accounts receivable. The buyer
will also pay $500,000 to $2.5 million, representing 10 percent of
new business generated from existing clients. In addition, the
buyer will pay 50 percent of collections on accounts receivable in
the next year in excess of $10 million.
The report relates that if the bankruptcy court in Trenton, New
Jersey, goes along with the schedule, there will be a June 4
auction testing for better offers. Assuming the court approves,
other bids will be due May 31. A hearing for approval of the sale
will take place June 5.
About Birdsall Services
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, 2013, when the state attorney general
indicted the business and obtained a court order seizing the
assets.
Birdsall was accused by the state of violating laws prohibiting
so-called pay-to-play, where businesses make political
contributions in return for government contracts. The state
charged that the company arranged for individuals to make
contributions and then reimbursed the employees. 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.
In April Birdsall reached a $3.6 million settlement that ended New
Jersey's opposition to the company's bankruptcy and resolves the
state's lawsuit aiming to seize Birdsall's assets. As part of the
settlement, Edwin Stier, a member of Stier Anderson, was appointed
as Chapter 11 trustee for Birdsall.
BORN AGAIN: Case Summary & 6 Unsecured Creditors
------------------------------------------------
Debtor: Born Again United Church Apostolic, Inc.
344-354 Webster Avenue
New Rochelle, NY 10801
Bankruptcy Case No.: 13-22675
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Southern District of New York (White Plains)
Judge: Robert D. Drain
Debtor's Counsel: Alvin J. Thomas, Esq.
10 Fiske Place
Suite 417
Mount Vernon, NY 10550
Tel: (917) 584-7678
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 six largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/nysb13-22675.pdf
The petition was signed by Tyrol Whilby, president.
BOUNDARY BAY: Plan Confirmation Hearing Continued to June 5
-----------------------------------------------------------
The hearing on the confirmation of Boundary Bay Capital, LLC's
Third Amended Chapter 11 Plan is continued to June 5, 2013, at
10:00 AM, before Judge Catherine E. Bauer of the U.S. Bankruptcy
Court for the Central District of California.
As reported in the Troubled Company Reporter on Feb. 11, 2013, the
Bankruptcy Court approved the disclosure Statement describing the
Third Amended Chapter 11 Plan.
According to the Third Amended Disclosure Statement, creditors
holding unsecured claims will become the new owners of the Debtor
and all the equity interests of the current owners will be
terminated. Secured creditors will be paid through the surrender
or sale of their collateral or through payments over time, in some
cases on a restructured basis.
Payments under the Plan will be funded through the proceeds of a
postpetition loan obtained by NewCo, a new company in which the
Debtor will have a membership interest, sales of assets, and funds
generated through operations. The Debtor will make periodic
distributions to creditors (as equity holders of the Reorganized
Debtor) as net proceeds become available.
About Boundary Bay
Boundary Bay Capital, LLC, is a California limited liability
company with its headquarters in Irvine, California. The Company
was in the business of making loans secured by liens on real
property and notes secured by other secured notes (which, in turn,
are secured by liens or real property). The Company also owns
some real property through foreclosure.
Boundary Bay Capital filed for Chapter 11 bankruptcy protection
(Bankr. C.D. Cal. Case No. 11-14298) on March 28, 2011. Evan D.
Smiley, Esq., and Hutchison B. Meltzer, Esq., at Weiland, Golden,
Smiley, Wang Ekvall & Strok, LLP, in Costa Mesa, Calif., serve as
the Debtor's bankruptcy counsel.
Affiliate Cartwright Properties, LLC, filed a separate Chapter 11
petition (Bankr. C.D. Cal. Case No. 10-17823) on June 9, 2010.
In its schedules, the Debtor disclosed $15.88 million in assets
and $54.45 million in liabilities.
BRONX RMT: Case Summary & 2 Unsecured Creditors
-----------------------------------------------
Debtor: Bronx RMT LLC
1481 47th Street
Brooklyn, NY 11219
Bankruptcy Case No.: 13-11426
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Debtor's Counsel: Mark A. Frankel, Esq.
BACKENROTH FRANKEL & KRINSKY, LLP
489 Fifth Avenue
New York, NY 10017
Tel: (212) 593-1100
Fax: (212) 644-0544
E-mail: mfrankel@bfklaw.com
Scheduled Assets: $2,500,000
Scheduled Liabilities: $28,693,683
A copy of the Company's list of its two largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/nysb13-11426.pdf
The petition was signed by Joseph Tyrnauer, managing member of
Lockaway 2, LLC, Debtor's managing member.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
VTE Philadelphia, LP 13-10058 01/07/13
CAESARS ENTERTAINMENT: S&P Lowers Corp. Credit Rating to 'CCC+'
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
corporate credit ratings on Las Vegas-based Caesars Entertainment
Corp. (CEC) and wholly owned subsidiary Caesars Entertainment
Operating Co. (CEOC) to 'CCC+' from 'B-'. The outlook is
negative. S&P also lowered the issue-level ratings on the
company's debt by one notch, in accordance with its notching
criteria, because its recovery ratings remain unchanged.
At the same time, S&P lowered its corporate credit ratings on
indirect wholly owned subsidiaries Caesars Linq LLC, Caesars
Octavius LLC, and Corner Investment Propco LLC to 'CCC+' from 'B-'
and S&P's issue-level ratings on the companies' debt to 'B-' from
'B'. The outlook on each corporate credit rating is negative.
"The downgrade reflects weaker-than-expected operating performance
in the first quarter, and our view that Caesars' capital structure
may be unsustainable over the next two years based on our EBITDA
forecast for the company," said Standard & Poor's credit analyst
Melissa Long. "We believe that the company could struggle to meet
fixed charges and might again seek to restructure its debt
obligations. We estimate that Caesars' EBITDA would need to grow
at least 25% in the aggregate over the next few years to fully
cover fixed charges, including interest expense and capital
expenditures. Increased interest expense associated with
refinancing transactions completed in 2012 and 2013 pressures
already weak EBITDA coverage of interest, and the continued cash
burn will exacerbate the difficulty Caesars has experienced
investing sufficiently in its properties to preserve its
competitive position over the past few years. In addition,
Caesars faces the maturity of nearly $5 billion in commercial
mortgage-backed securities (CMBS) debt in 2015 and will likely
face substantially higher interest costs upon refinancing. We
have less concern over the near term. The 2012 and 2013
refinancing transactions improved Caesars' maturity profile and
strengthened its near-term liquidity profile by providing
additional cash to fund capital spending or other development
needs, and we do not expect the company to face a near-term
liquidity crisis.
In the first quarter of 2013, Caesars' Las Vegas region properties
saw property EBITDA decline 6.3%. In addition, ongoing weakness
in Atlantic City and a challenging year-over-year comparison in
regional gaming markets resulted in property EBITDA (pro forma for
the divestiture of St. Louis) falling about 8.5%. S&P's previous
full-year 2013 expectation was for modest growth in EBITDA. S&P
currently expects Caesars' consolidated EBITDA will be relatively
flat in 2013. S&P expects Las Vegas to stabilize over the coming
quarters and that investments in properties on the Las Vegas Strip
will drive property level EBITDA improvement later in 2013 and
into 2014. S&P expects lingering weakness in the Atlantic City
region in 2013, and S&P has incorporated an expectation for
property level EBITDA declines in the high-single-digit percentage
area in 2013. Although performance was relatively weak in the
first quarter in most regional gaming markets, given S&P's
economists' expectations for modest GDP and consumer spending
growth S&P believes the rest of the year will show modest revenue
growth in regional markets. S&P expects this will drive
relatively flat property level EBITDA across Caesars' regional
properties.
The downgrades of Caesars Linq LLC, Octavius LLC, and Corner
Investment Propco LLC reflect the link between those ratings and
that of the ultimate parent, CEC. Although these entities are
structured as unrestricted subsidiaries of CEC, S&P believes their
credit quality is linked to that of CEC. S&P believes that a
bankruptcy at CEC could cause a bankruptcy at the subsidiary
borrowers if management decides it is in its best interest to
include the subsidiary borrowers in a broader bankruptcy
proceeding. Beyond the structural link related to CEC's
controlling position, these entities will also rely on lease
payments from the direct parent CEOC, and these lease payments
comprise the majority of cash flows available to service the debt
at these entities under our forecast.
S&P's corporate credit rating reflects its assessment of Caesars'
financial risk profile as "highly leveraged" and its assessment of
the company's business risk profile as "satisfactory."
S&P's rating outlook on Caesars is negative. S&P believes that
the company's very weak credit measures and its view that it will
continue to burn cash to fund capital expenditures and interest
expense indicate that the capital structure is likely
unsustainable. Given S&P's expectations for future performance
and the significant refinancing risk associated with its
intermediate-term debt maturities, S&P believes a restructuring of
at least a portion of its debt obligations is increasingly likely.
S&P could lower the rating if operating performance, particularly
in Las Vegas, does not show signs of stabilization and improvement
over the next few quarters and if S&P no longer believes that
positive momentum will start to build again in that region as
Caesars benefits from some ongoing investments in its portfolio of
properties in Las Vegas. S&P believes continued weakness in Las
Vegas could lead to a faster-than-expected deterioration in the
company's liquidity position and increase the likelihood that it
may move forward with a refinancing or restructuring plan that
would result in debtholders being offered less than what S&P deems
as full and timely payment under its ratings criteria.
S&P is unlikely to consider a revision of the outlook to stable or
an upgrade absent meaningful and more rapid EBITDA growth relative
to its operating forecast or a significant reduction in leverage
such that, in its view, the company's capital structure is likely
sustainable in the long term.
CARRIAGE SERVICES: S&P Withdraws 'B' Corporate Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services said it withdrew its 'B'
corporate credit rating on U.S.-based Carriage Services Inc. at
the company's request. S&P do not rate any current outstanding
debt following the mid-2012 refinancing of its notes with a credit
facility.
CATALYST PAPER: Posts $9.8-Mil. Net Loss in First Quarter 2013
--------------------------------------------------------------
Catalyst Paper on May 6 posted a net loss of $9.8 million ($0.89
per common share) in the first quarter of 2013. The loss was
$11.6 million before specific items. Improvement over the final
quarter of 2012 -- when the company recorded a loss of $35.2
million ($1.55 per common share) and $15.7 million before specific
items -- was driven by increased prices for pulp, and lower
maintenance costs.
Adjusted earnings before interest, tax, depreciation and
amortization (EBITDA) in the first quarter were $11.2 million, up
from $7.2 million in the final quarter of 2012. Adjusted EBITDA
was not impacted by restructuring costs in either quarter.
"The Chinese economic rebound has driven pulp shipments and prices
up," said Catalyst President and CEO Kevin J. Clarke. "But we had
much tougher conditions on the paper side of the business, with a
10% drop in North American demand for newsprint and a 15% decrease
in directory paper. Labor costs also tipped up due to unforeseen
maintenance requirements. The fact that we improved EBITDA
indicates how much better positioned we are after last year's
restructuring."
Quarter Highlights
Catalyst listed new shares on the Toronto Stock Exchange on
January 7, 2013 under the symbol CYT. A small shareholder selling
program began on that date and ended on February 28.
Net income in the quarter was boosted by the completion of two
asset sales. The court-approved sale of Snowflake mill assets and
shares of the Apache Railway closed on January 30 for US$13.5
million and other non-monetary consideration. Sale of Catalyst's
50% interest in Powell River Energy Inc. (PREI) completed on March
20 for $33.0 million. Catalyst continues to purchase electricity
generated by PREI.
Approximately $12.7 million of net proceeds from the PREI sale
were distributed to unsecured creditors who elected cash rather
than shares in settlement of their claims. These were the last
outstanding creditor claims under the plan of arrangement through
which Catalyst exited creditor protection in 2012.
On March 25, Catalyst offered to purchase US$20.0 million of its
floating rate senior secured exit notes, at par plus accrued and
unpaid interest, using proceeds from the PREI sale. Holders of
US$15.6 million in notes accepted this now-expired offer. The
Company is in discussions with certain holders of the remaining
exit notes with a view to obtaining a waiver of the terms of the
indenture governing the exit notes to permit the company to
repurchase our PIK Toggle Senior Secured Notes due 2017 while exit
notes are outstanding.
Two new products were launched this quarter. Marathon Lite is a
low basis weight newsprint which has attracted strong interest
among Latin American newspaper publishers. Ascent is a coated
three grade and now the highest-value paper Catalyst produces.
Ascent will be rolled out over the balance of the year, with a
particular focus on the commercial printing segment.
Liquidity was up by $42.9 million from the prior quarter due to an
increase in the borrowing base, a decrease in the amount drawn on
the asset based loan facility, and an increase in restricted cash.
British Columbia reverted on April 1 from a harmonized sales tax
to a provincial sales tax, adding approximately $12 million in
direct annualized costs, $8 million related to purchased
electricity.
Subsequent to quarter-end, Catalyst announced Kevin J. Clarke's
decision to step down as president and CEO at mid-year and a
search for his successor is underway.
Market Conditions
Benchmark prices and North American demand were down for all paper
grades. Demand for lightweight coated declined by 5.3% while
remaining flat for uncoated mechanical. Directory demand was down
15.3% and newsprint demand fell by 10.2%. The Company's newsprint
sales volumes were up over a year ago in part due to customer
interest in Marathon Lite, while sales volumes for its specialty
grades declined in the quarter. Lower sales volumes for paper
were partly due to a production shortfall resulting from certain
unforeseen maintenance events in the quarter.
The Northern Bleached Softwood Kraft (NBSK) pulp markets continued
to recover in the first quarter as improved demand from Western
Europe and North America helped offset a slowdown in China.
Global demand slipped by 1.6% from a strong first quarter in 2012,
but increased from fourth quarter shipments. Benchmark pulp
prices continued to improve moderately during the quarter,
although excess inventory build-up in China was observed.
Outlook
The current outlook for global growth has improved, reflecting
modest recovery in China and the United States during the first
quarter. The Canadian dollar is expected to weaken slightly going
forward.
Further demand decline is foreseen for coated mechanical grades,
while demand for uncoated grades will likely increase slightly,
although with the potential for downward pressure on operating
rates resulting from the restart of uncoated capacity in the
fourth quarter of 2012. Specialty paper prices are expected to
remain under pressure in the second quarter before rebounding in
the second half of 2013.
Further demand contraction and price weakness is foreseen for
newsprint, while continued improvement is expected for NBSK
markets.
Second quarter maintenance costs will be impacted by a total mill
outage at Crofton. The number one paper machine at that operation
will remain indefinitely curtailed. Capital spending is expected
to be approximately $25 million for the year, but will be managed
to balance cash flow.
About Catalyst Paper
Catalyst Paper Corp. (TSX: CYT) -- http://www.catalystpaper.com/
-- manufactures diverse specialty mechanical printing papers,
newsprint and pulp. Its customers include retailers, publishers
and commercial printers in North America, Latin America, the
Pacific Rim and Europe. With three mills, located in British
Columbia, Catalyst has a combined annual production capacity of
1.5 million tonnes. The Company is headquartered in Richmond,
British Columbia, Canada and is ranked by Corporate Knights
magazine as one of the 50 Best Corporate Citizens in Canada.
On Jan. 31, 2012, Catalyst Paper Corporation and certain of its
subsidiaries obtained an Initial Order from the Supreme Court of
British Columbia under the Companies' Creditors Arrangement Act
(CCAA). The Company applied for recognition of the Initial Order
under Chapter 15 of Title 11 of the U.S. Bankruptcy Code.
Catalyst Paper Corporation and all of its subsidiaries and
partnership successfully emerged from creditor protection
proceedings under the CCAA and Chapter 15 of the U.S. Bankruptcy
Code on Sept. 13, 2012. The Company met all of the conditions to
implement the second amended plan of arrangement on the emergence
date by securing exit financing consisting of a new asset-based
loan facility (ABL Facility) and new floating rate senior secured
notes (Floating Rate Notes).
CELL THERAPEUTICS: Incurs $19.4-Mil. Net Loss in First Quarter
--------------------------------------------------------------
Cell Therapeutics, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $19.38 million on $1.12 million of total revenues
for the three months ended March 31, 2013, as compared with a net
loss of $17.44 million on $0 of total revenues for the same period
during the prior year.
The Company's balance sheet at March 31, 2013, showed $65.26
million in total assets, $35.70 million in total liabilities,
$13.46 million in common stock purchase warrants, and $16.10
million in total shareholders' equity.
"In the first quarter, we generated initial commercial sales of
PIXUVRI(R) in countries in the European Union where there is
market access pending the completion of the reimbursement
process," said James Bianco, M.D., president and CEO of CTI.
"Although it is early in the launch, we are pleased with the
interest and receptivity of PIXUVRI by key lymphoma opinion
leaders who treat patients with multiply relapsed or refractory
aggressive B-cell non-Hodgkin lymphoma (NHL) and who recognize the
significant unmet need that exists for these patients. In
addition, our Phase 3 PERSIST-1 clinical trial of pacritinib, an
oral, once-daily JAK2/FLT3 inhibitor, in myelofibrosis continues
to progress with the opening of additional sites and growing
enrollment."
A copy of the Form 10-Q is available for free at:
http://is.gd/GUXM56
About Cell Therapeutics
Headquartered in Seattle, Washington, Cell Therapeutics, Inc.
(NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is
a biopharmaceutical company committed to developing an integrated
portfolio of oncology products aimed at making cancer more
treatable.
Cell Therapeutics reported a net loss attributable to CTI of
US$62.36 million in 2011, compared with a net loss attributable
to CTI of US$82.64 million in 2010.
Going Concern Doubt Raised
The report of Marcum LLP, in San Francisco, Calif., dated
March 8, 2012, expressed an unqualified opinion, with an
explanatory paragraph as to the uncertainty regarding the
Company's ability to continue as a going concern.
The Company's available cash and cash equivalents are US$47.1
million as of Dec. 31, 2011. The Company's total current
liabilities were US$17.8 million as of Dec. 31, 2011. The
Company does not expect that it will have sufficient cash to fund
its planned operations beyond the second quarter of 2012, which
raises substantial doubt about the Company's ability to continue
as a going concern.
Bankruptcy Warning
The Form 10-K for the year ended Dec. 31, 2011, noted that if the
Company receives approval of Pixuvri by the EMA or the FDA, it
would anticipate significant additional commercial expenses
associated with Pixuvri operations. Accordingly, the Company
will need to raise additional funds and are currently exploring
alternative sources of equity or debt financing. The Company may
seek to raise that capital through public or private equity
financings, partnerships, joint ventures, disposition of assets,
debt financings or restructurings, bank borrowings or other
sources of financing. However, the Company has a limited number
of authorized shares of common stock available for issuance and
additional funding may not be available on favorable terms or at
all. If additional funds are raised by issuing equity
securities, substantial dilution to existing shareholders may
result. If the Company fails to obtain additional capital when
needed, it may be required to delay, scale back, or eliminate
some or all of its research and development programs and may be
forced to cease operations, liquidate its assets and possibly
seek bankruptcy protection.
CENTRAL EUROPEAN: Further Amends Securities Purchase Agreement
--------------------------------------------------------------
Central European Distribution Corporation, Roust Trading Ltd and
JSC "Russian Alcohol Group" entered into an Amended and Restated
Securities Purchase Agreement on April 26, 2013. The Amended and
Restated SPA amends and restates the Securities Purchase Agreement
dated March 8, 2013, previously filed on CEDC's Schedule TO-I/A,
dated March 11, 2013.
The Amended and Restated SPA amends the Original SPA to reflect
the terms of the agreement reached between RTL and certain holders
of CEDC's 3.00% Convertible Notes due 2013 as provided for in the
amended and restated plan support agreement, dated as of March 20,
2013, among RTL and certain holders of the 2013 Notes, previously
filed on Amendment No. 16 to Schedule 13D by RTL on March 21,
2013. Among the changes to the Original SPA reflected in the
Amended and Restated SPA are amendments to reflect the withdrawal
of the CEDC exchange offer to 2013 Noteholders, by the tender
offer by RTL to holders of the 2013 Notes, and the issuance of all
newly issued shares of CEDC common stock to RTL pursuant to CEDC's
prepackaged plan of reorganization.
In addition to the conditions set forth in the Original SPA, the
Amended and Restated SPA provides that the obligation of RTL to
consummate the RTL Investment is conditioned upon:
* the cancellation of the 2013 Notes and the Senior Secured
Notes due 2016 issued by CEDC Finance Corporation
International, Inc., and the discharge of the indentures
governing the 2013 Notes and the 2016 Notes; and
* the conditions to the closing of the RTL Offer having been
satisfied or waived in accordance with the terms of the RTL
Offer.
In addition to the termination rights set forth in the Original
SPA, the Amended and Restated SPA grants RTL the right to
terminate the Amended and Restated SPA if either (1) the plan
support agreement, dated as of March 25, 2013, among RTL, certain
holders of the 2016 Notes, CEDC and CEDC Finance Corporation
International, Inc., or (2) the 2013 PSA, if CEDC accedes to and
executes the 2013 PSA, is terminated in accordance with its terms.
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.
On April 7, 2013, CEDC and two subsidiaries sought bankruptcy
protection under Chapter 11 of the Bankruptcy Code (Bankr. D.
Del. Lead Case No. 13-10738) with a prepackaged Chapter 11 plan
that reduces debt by US$665.2 million.
Attorneys at Skadden, Arps, Slate, Meagher & Flom LLP serve as
legal counsel to the Debtor. Houlihan Lokey is the investment
banker. Alvarez & Marsal will provide the chief restructuring
officer. GCG Inc. is the claims and notice agent.
CHARLOTTE RUSSE: Moody's Rates New $150MM Senior Term Loan 'B2'
---------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
and a B2-PD Probability of Default Rating to Charlotte Russe
Holding, Inc. Moody's also assigned a B2 (LGD 3, 48%) rating to
Charlotte Russe, Inc.'s proposed $150 million senior secured term
loan. The rating outlook is negative.
The following ratings were assigned:
Charlotte Russe Holding, Inc.
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
Charlotte Russe, Inc.
$150 million senior secured term loan due 2019 at B2 (LGD 3,
48%)
Ratings Rationale:
Charlotte Russe's B2 Corporate Family Rating reflects the
company's moderate degree of differentiation within the highly
competitive and fragmented 'fast fashion' industry, its limited
scale with revenues of approximately $856 million, and the
company's very low, albeit improving, operating margins. The
rating also reflects the company's high financial leverage with
debt/EBITDA in the high six times range (incorporating Moody's
standard analytic adjustments including capitalizing operating
leases, but before any adjustments related to the company's
preferred stock issued to its sponsor). This transaction, which is
occurring soon on the heels of the relatively recent return to
operating profitability, is viewed as indicative of an aggressive
financial policy. The rating also considers the positive trends in
Charlotte Russe's performance under the company's current
management team, which has seen the company drive improvements in
sales and margins through improved merchandising, cost controls
and actions taken to reconfigure its store base and to drive
improvements in the company's real estate costs which remain a
significant proportion of revenues. The company is expected to
maintain a good liquidity profile, with reasonable cash balances
and positive free cash flow as well as access to a $60 million
asset based revolver that will likely remain substantially unused
even during periods of higher seasonal working capital
requirements.
The B2 rating assigned to the company's senior secured term loan
reflects its 2nd lien position on the company's accounts
receivable and inventory (ranking junior to the $60 million asset-
based revolver) and its first lien on substantially all other
assets of the borrower.
The negative outlook reflects uncertainty regarding management's
ability to continue progress in improving sales and expanding
operating margins given the highly competitive and fragmented
nature of the fast fashion industry. The company competes against
a number of larger players, some of whom have significant global
scale and substantially greater resources. The company will need
to make continued progress over the next 12 to 18 months to
sustain recent positive trends such that debt/EBITDA approaches
the low six times range (before consideration of any adjustments
to leverage from the company's preferred stock issued to its
sponsor).
Ratings could be downgraded if there was a moderate deviation from
recent positive trends in sales and operating margin expansion.
Quantitatively ratings could be lowered if debt/EBITDA is expected
to remain above 6.5 times or interest coverage was sustained below
1.2 times.
In view of the company's high leverage and moderate operating
margins ratings are unlikely to be upgraded in the near to
intermediate term. Over time, ratings could be upgraded if
operating margins approached the mid single-digit range and
debt/EBITDA approached 5 times. The rating outlook could be
stabilized if the company demonstrates continued success in its
marketing and merchandising initiatives, which would be evidenced
by maintaining low single-digit comparable store sales growth,
while achieving improved operating margins, through improved gross
margins and leverage of fixed costs notably its high rent
expenses. A stable outlook would also require lower leverage.
The principal methodology used in this rating was the Global
Retail Industry Methodology published in June 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Headquartered in San Francisco, CA, Charlotte Russe is a retailer
of value-oriented 'fast fashion' apparel and accessories,
targeting 18-24 year old women. At the end of its most recent
fiscal year, the Company operated 500 retail stores in the US and
Puerto Rico and generated sales through its ecommerce platform as
well. Revenues in its most recent fiscal year were $856 million.
The company has been owned since late 2009 by affiliates of Advent
International and current management.
CHESTER DOWNS: S&P Lowers Corporate Credit Rating to 'CCC+'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Chester, Pa.-based Chester Downs and Marina LLC to
'CCC+' from 'B-'. The outlook is negative. S&P lowered the
issue-level ratings on Chester Downs to 'B' from 'B+'. The
downgrade follows a similar action on Caesars Entertainment Corp.
(CEC) and its wholly owned subsidiary, Caesars Entertainment
Operating Co. Inc. (CEOC). Given CEC's 99.5% ownership stake
through CEOC, S&P views Chester Downs and Marina's rating as
linked to that of CEC.
S&P's rating outlook is negative, reflecting the link between
Chester and CEC.
S&P could lower the rating on CEC if operating performance,
particularly in Las Vegas, did not show signs of stabilization and
improvement over the next few quarters and if S&P no longer
believed that positive momentum would start to build again in that
region as Caesars benefits from some ongoing investments in its
portfolio of properties in Las Vegas. S&P believes continued
weakness in Las Vegas could lead to a faster-than-expected
deterioration in the Caesars' liquidity position and increase the
likelihood that Caesars may move forward with a refinancing or
restructuring plan that would result in debtholders being offered
less than what S&P deems as full and timely payment under its
ratings criteria.
"We are unlikely to consider a revision of the outlook to stable
or an upgrade absent meaningful and more rapid EBITDA growth
relative to our operating forecast and/or a significant reduction
in leverage such that, in our view, Caesars' capital structure is
likely sustainable in the long term," said Standard & Poor's
credit analyst Melissa Long.
CHINESEWORLDNET.COM INC: Incurs US$129K Net Loss in 2012
--------------------------------------------------------
Chineseworldnet.Com Inc. filed on April 30, 2013, its annual
report on Form 20-F for the year ended Dec. 31, 2012.
Chang Lee LLP, in Vancouver, Canada, expressed substantial doubt
about Chineseworldnet.Com's ability to continue as a going
concern. The independent auditors noted that the Company has
incurred recurring losses from inception and requires additional
financing for its intended business operations.
The Company reported a net loss of US$128,931 on US$1.2 million of
revenue in 2012, compared with net income of US$138,040 on US$1.7
million of revenue in 2011.
The Company's balance sheet at Dec. 31, 2012, showed
US$2.6 million in total assets, US$546,060 in total current
liabilities, and stockholders' equity of $2.0 million.
A copy of the Form 20-F is available at http://is.gd/gA0hIW
Chineseworldnet.Com Inc., based in Vancouver, Canada, is a
corporation incorporated under the Company Law (1998 revision) of
the Cayman Islands on January 12, 2000. The Company has four
principal businesses: (1) the financial web portal business,
conducted under the ChineseWorldNet.com brand via the
"www.chineseworldnet.com" website; (2) the investor relations and
public relations ("IR/PR") business, conducted under the NAI500
brand via a number of media channels including the
"www.nai500.com" and "en.nai500.com" websites, as well as certain
other promotional services; (3) the North America and Greater
China cross-border business partnering conferences ("Conference")
business, conducted via the brand of Global Chinese Financial
Forum and its "www.gcff.ca" website; and (4) the financial content
and information distribution business.
CITRUS MEMORIAL: Fitch Lowers Rating on $38.4-Mil. Bonds to 'B'
---------------------------------------------------------------
Fitch Ratings has downgraded the rating on approximately
$38.4 million series 2002 bonds issued by the Citrus County
Hospital Board (Citrus Memorial Health Foundation, Inc.) on behalf
of Citrus Memorial Hospital (CMH) to 'B' from 'BB-'.
In addition, Fitch has placed the rating on Rating Watch Negative
reflecting the concern that CMH's failure to meet covenanted debt
service coverage (DSC) for fiscal 2013 could trigger an event of
default. Fitch expects to resolve the Rating Watch in the next few
months as fiscal 2013 metrics become available.
SECURITY
The series 2002 bonds are secured by a pledge of gross revenues of
the Foundation and a debt service reserve fund.
KEY RATING DRIVERS
DETERIORATING FINANCIAL PROFILE: The rating downgrade to 'B'
reflects the unstable operating environment related to an ongoing
legal dispute over the control of the hospital, which has resulted
in a deteriorating financial profile over the last three years.
CMH's financial performance in fiscal 2012 (Sept. 30 year end)
deteriorated for the third consecutive year and was plagued by
undependable tax revenue, ongoing legal costs, system conversion
issues, and loss of revenue due to increased outpatient
competition. CMH's DSC calculation per the master trust indenture
(MTI) was 1.26x and the DSC covenant was only met because the
Citrus County Hospital Board (CCHB) released $2 million of funds
to the hospital, which was to be used to pay down a portion of the
series 2006 bonds.
ACCELERATED REPAYMENT OF DEBT: The downgrade also reflects the
accelerated repayment of CMH's outstanding debt as the financial
deterioration of the hospital has led the holder of the series
2006 bonds (SunTrust Bank) to exercise its right to a mandatory
tender following a 366-day notice period. SunTrust Bank exercised
its right in April 2013; therefore the remaining $6 million of
bonds outstanding is to be paid by April 2014. Repayment of the
bonds could deplete CMH's cash holdings and severely compromise
liquidity, absent the receipt of additional funds from the CCHB.
POTENTIAL CROSS-DEFAULT: The accelerated repayment of the series
2006 bonds could also result in DSC below 1.1x for fiscal 2013,
which may trigger an event of default under the 2006 loan
agreement. An event of default under the 2006 agreement, which
would be at the discretion of the bank, would result in a cross-
default to the series 2002 bonds.
RATING SENSITIVITIES
NEGATIVE RATING MOVEMENT: An event of default would result in
further downward rating action.
ABILITY TO MEET COVENANT CALCULATIONS: If CMH can meet its
covenant calculations (1.1x debt service coverage and 65 days cash
on hand), the Rating Watch could be resolved and the rating could
remain the same. Debt service coverage through the six months
ended March 31, 2013 including the accelerated repayment of debt
was 1.12x.
RESOLUTION OF BROADER CONFLICTS: The resolution of the broader
conflicts between CMH and CCHB, as well as the near-term financial
strains, could provide a foundation for the resolution of the
Rating Watch and a higher rating.
CREDIT PROFILE
Ongoing Governance Issues
Citrus Memorial Health Foundation operates CMH under a long-term
lease with CCHB. When the lease was executed, CCHB entered into a
hospital care agreement which stated that CCHB would provide funds
to the Foundation through its ability to levy ad valorem taxes as
an independent special district in Citrus County. The CCHB can
levy taxes up to 3 mills of assessed value.
From 2009-2012, the Foundation and CCHB have been involved in a
legal dispute regarding future operational control of the
facility. Because of this, CCHB began reducing the tax millage
rate as well as withholding tax revenue that has been levied. The
tax millage for fiscal 2013 was 0.245 mills and the hospital's
fiscal 2013 budget incorporated $4 million of tax revenue. Through
the six months ended March 31, 2013, none has been received. The
total amount due to the Foundation from fiscal years 2009-2012 is
approximately $7 million.
One case currently being litigated relates to a local bill that
would grant control of the hospital to the CCHB. The CCHB is made
up of five appointed members by the Governor. The case is at the
state supreme court whereby the Foundation challenged the
constitutionality of the local bill. Management expects this case
to be resolved in the next 12-14 months. Fitch will assess the
impact of the outcome of this case when it is resolved.
Weak Financial Profile
Fiscal 2012 financial performance was poor as issues with its
information technology system and a decline in net patient revenue
exacerbated the already challenged situation related to the
withholding of tax revenue and ongoing legal expenses. Fiscal 2012
net patient revenue was $147 million compared to $151 million the
prior year as one of CMH's competitors opened a cardiac
catheterization lab, which resulted in lost volume.
In fiscal 2012, CMH reported a $6.9 million operating loss
(negative 4.6% operating margin) compared to a $3.7 million
operating loss (negative 2.4% operating margin) the prior year. In
fiscal 2012, CMH received only $800,000 of tax revenue of the $2.2
million levied and collected by CCHB. In addition to the $800,000,
CCHB released $2 million of funds on the condition that the
hospital matched the funds by $1 million to pay down a portion of
the series 2006 bonds.
Debt service coverage (as calculated by Fitch) was very weak at
0.8x for fiscal 2012, but the organization met its 1.1x coverage
covenant since the $2 million from CCHB was counted toward net
income available for debt service although not reflected on the
income statement.
At March 31, 2013 CMH had $26.5 million in unrestricted cash and
investments, which translated into 65.1 days cash on hand (DCOH),
5.7x cushion ratio, and 49.9% cash to debt. CMH's liquidity
position is down from fiscal 2011 at $38.2 million and CMH will
likely trigger its liquidity covenant (65 days cash on hand), as
the remaining $6 million pay down of the series 2006 bonds will
need to be funded from hospital cash unless CCHB releases the
funds they have been withholding.
Potential Event of Default
With the acceleration of the series 2006 bonds, the fiscal 2013
DSC covenant calculation will be based on debt service of
approximately $9.967 million, which includes the full principal of
the series 2006 debt. The DSC calculation for the six months ended
March 31, 2013 including the accelerated debt is 1.12x. However,
the bank documents do not clearly specify if DSC below 1.1x is
automatically an event of default and the bank could extend the
hospital a cure period. In addition, the hospital's cash position
would be further depleted after the paydown of the series 2006
bonds and would hamper its ability to meet its DCOH covenant at
Sept. 30, 2014. Pro forma DCOH at March 31, 2013 including the
paydown of the series 2006 bonds results in 50 days cash on hand.
Future Unknown
Adding to the uncertainty of CMH's future are the current actions
by both the Foundation and CCHB to evaluate other options for the
hospital, including sale, lease or affiliation. However, these
discussions are being done independently of each other and any
decision will require approval from both boards. Fitch believes
some cooperation between the two entities will be needed
especially as the organization's future viability in the post-
reform environment is at stake.
Rating Watch
Fitch will assess Citrus' financial performance at fiscal 2013
year end and their ability to meet covenant requirements. Further
negative rating pressure would occur if there is an event of
default. However, the release of tax revenues collected from prior
years to CMH and/or fully utilizing the taxing capability for the
benefit of CMH would be viewed positively by Fitch.
About the Organization
CMH is a 198-bed community hospital located in Inverness, FL,
approximately 75 miles north of Tampa. In fiscal 2012, CMH had
$151 million in total operating revenue. CMH covenants to provide
quarterly disclosure by written request to bondholders who hold
more than $1 million in bonds and distributes annual financial
statements to the Municipal Securities Rulemaking Board's EMMA
system.
CLEAR CHANNEL: Incurs $203 Million Net Loss in First Quarter
------------------------------------------------------------
Clear Channel Communications, Inc., filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss attributable to the Company of $203 million
on $1.34 billion of revenue for the three months ended March 31,
2013, as compared with a net loss attributable to the Company of
$143.62 million on $1.36 billion of revenue for the same period
during the prior year.
The Company's balance sheet at March 31, 2013, showed $15.51
billion in total assets, $23.72 billion in total liabilities and a
$8.20 billion total shareholders' deficit.
"The strength of our businesses was clear in the company's solid
first quarter results, which included growing returns from our
strategic investments in key digital assets," chief executive
officer Bob Pittman said. "Across the company, we are creating
unique, engaging solutions for clients that use our unparalleled
multi-platform reach. With our advertisers, we are innovating new
ways to use our assets to reach consumers more effectively
wherever they are - which is increasingly out of their homes.
Rather than staying in their connected homes as once predicted,
people are now making more mobile connections than ever before.
This trend toward the connected consumer plays to the strengths of
Clear Channel in broadcast and digital radio and outdoor displays,
and we are beginning to make progress in monetizing it."
A copy of the Form 10-Q is available for free at:
http://is.gd/8gBwbQ
Clear Channel has amended its annual report for the period ended
Dec. 31, 2012, to (1) identify Clear Channel Capital I, LLC, as a
filer and (2) refile the certifications by the principal executive
officer and principal financial officer of Clear Channel
Communications, Inc. The officers signing the Clear Channel
Communications, Inc., certifications are the same individuals and
hold the same positions with both Clear Channel Communications,
Inc., and Clear Channel Capital I, LLC. No other changes have
been made to the Clear Channel Communications, Inc., Form 10-K for
the year ended Dec. 31, 2012.
Each of Clear Channel Capital I, LLC, and Clear Channel
Communications, Inc., will file separate Form 10-K, Form 10-Q and
Form 8-K filings with the Securities and Exchange Commission in
the future.
A copy of the Amended Form 10-K is available for free at:
http://is.gd/CZelhp
About Clear Channel
San Antonio, Texas-based CC Media Holdings, Inc. (OTC BB: CCMO) --
http://www.ccmediaholdings.com/-- is the parent company of Clear
Channel Communications, Inc. CC Media Holdings is a global media
and entertainment company specializing in mobile and on-demand
entertainment and information services for local communities and
premier opportunities for advertisers. The Company's businesses
include radio and outdoor displays.
Clear Channel reported a net loss of $302.09 million on $6.16
billion of revenue in 2011, compared with a net loss of $479.08
million on $5.86 billion of revenue in 2010. The Company had a
net loss of $4.03 billion on $5.55 billion of revenue in 2009.
The Company's balance sheet at June 30, 2012, showed
$16.45 billion in total assets, $24.31 billion in total
liabilities, and a $7.86 billion total shareholders deficit.
Bankruptcy Warning
At March 31, 2012, the Company had $20.7 billion of total
indebtedness outstanding.
The Company said in its quarterly report for the period ended
March 31, 2012, that its ability to restructure or refinance the
debt will depend on the condition of the capital markets and the
Company's financial condition at that time. Any refinancing of
the Company's debt could be at higher interest rates and increase
debt service obligations and may require the Company and its
subsidiaries to comply with more onerous covenants, which could
further restrict the Company's business operations. The terms of
existing or future debt instruments may restrict the Company from
adopting some of these alternatives. These alternative measures
may not be successful and may not permit the Company or its
subsidiaries to meet scheduled debt service obligations. If the
Company and its subsidiaries cannot make scheduled payments on
indebtedness, the Company or its subsidiaries, as applicable, will
be in default under one or more of the debt agreements and, as a
result the Company could be forced into bankruptcy or liquidation.
* * *
The Troubled Company Reporter said on Feb. 10, 2012, Fitch Ratings
has affirmed the 'CCC' Issuer Default Rating of Clear Channel
Communications, Inc., and the 'B' IDR of Clear Channel Worldwide
Holdings, Inc., an indirect wholly owned subsidiary of Clear
Channel Outdoor Holdings, Inc., Clear Channel's 89% owned outdoor
advertising subsidiary. The Rating Outlook is Stable.
Fitch's concerns center on the company's highly leveraged capital
structure, with significant maturities in 2014 and 2016; the
considerable and growing interest burden that pressures free cash
flow; technological threats and secular pressures in radio
broadcasting; and the company's exposure to cyclical advertising
revenue. The ratings are supported by the company's leading
position in both the outdoor and radio industries, as well as the
positive fundamentals and digital opportunities in the outdoor
advertising space.
As reported by the TCR on Feb. 25, 2013, Standard & Poor's Ratings
Services affirmed its 'CCC+' corporate credit rating on Texas-
based Clear Channel Communications Inc. and CC Media Holdings.
Standard & Poor's Ratings Services' rating on CC Media Holdings
Inc. reflects the risks surrounding the long-term viability of its
capital structure--in particular, refinancing risk relating to
significant 2016 debt maturities of about $10 billion.
CLEARWIRE CORP: Mails Letter to Shareholders on Sprint Deal
-----------------------------------------------------------
Clearwire on May 6 mailed a letter to stockholders regarding its
proposed transaction with Sprint Nextel Corporation. The letter
describes the proposed transaction with Sprint as providing the
best strategic alternative for Clearwire's minority stockholders,
representing fair, attractive and certain value.
The full text of the letter follows:
May 6, 2013
On May 21, 2013, Clearwire will hold a Special Meeting of
Stockholders to vote on the proposed Sprint transaction.
Clearwire stockholders of record as of the close of business on
April 2, 2013, are entitled to vote at the Special Meeting.
PROPOSED TRANSACTION WITH SPRINT PROVIDES THE BEST STRATEGIC
ALTERNATIVE FOR CLEARWIRE'S MINORITY STOCKHOLDERS AND REPRESENTS
FAIR, ATTRACTIVE AND CERTAIN VALUE
Clearwire's board of directors has always been committed to
considering strategic options and pursuing those that maximize
stockholder value. A Special Committee conducted a careful and
rigorous review of all options available to Clearwire, with the
assistance of independent financial and legal advisors. On the
unanimous recommendation of the Special Committee, the Clearwire
board has unanimously concluded that the proposed transaction with
Sprint is the best strategic alternative for stockholders,
representing fair, attractive and certain value, especially in
light of the Company's limited alternatives and the well-known
constraints of its liquidity position.
The proposed $2.97 per share offer price equates to a total
payment to Clearwire minority stockholders of approximately $2.2
billion. This transaction represents a total Clearwire enterprise
value of approximately $10 billion, including net debt and
spectrum lease obligations of $5.5 billion. Additional benefits
include:
-- Attractive spectrum value of $0.21 / MHz - POP;
-- A ~130% premium to Clearwire's closing share price on October
10, 2012, just before Sprint publicly acknowledged its merger
discussions with SoftBank, and Clearwire was speculated to be part
of that transaction;
-- A 40% premium to the closing share price on November 20, 2012,
the day before Clearwire received Sprint's $2.60 per share initial
non-binding indication of interest;
-- Higher certainty of value for stockholders compared to other
alternatives; and
-- Immediate liquidity to stockholders at transaction close.
SPRINT PROPOSAL WAS THOROUGHLY EVALUATED BY CLEARWIRE'S
BOARD OF DIRECTORS AND SPECIAL COMMITTEE
Clearwire formed a Special Committee, comprised of three directors
independent from Sprint. Clearwire's Special Committee hired its
own legal and financial advisors to evaluate and negotiate the
Sprint transaction. Specifically, the Special Committee:
-- Rejected Sprint's initial indication of interest of $2.60;
-- Oversaw subsequent negotiations, leading to an increase in the
offer price of 14% and other more favorable terms; and
-- Received a fairness opinion from its financial advisors that
the $2.97 merger consideration was fair, from a financial point of
view, to the Company's non-Sprint stockholders.
In addition to the actions taken by the Special Committee outlined
above, the Board hired its own separate, independent legal and
financial advisors and received a fairness opinion stating that
the $2.97 merger consideration was fair, from a financial point of
view, to the Company's non-Sprint stockholders.
The $2.97 per share consideration represents a substantial premium
to the price received by other sophisticated investors in recent
transactions. For example, Google received $2.26 per share for
its Clearwire Common Stock on March 1, 2012, and Time Warner
received $1.37 per share for its Clearwire Common Stock on October
3, 2012.
In addition, Eagle River received $2.97 per share for its sale of
Clearwire Common Stock on December 17, 2012.
Other stockholders consider $2.97 to be a fair and compelling
price: Comcast, Intel, and Bright House Networks have committed to
vote their shares in support of the transaction. Collectively,
these sophisticated investors own approximately 13% of the voting
shares, or approximately 26% of non-Sprint voting shares.
CLEARWIRE'S STANDALONE PROSPECTS ARE RISKY AND HIGHLY UNCERTAIN
The proposed transaction with Sprint provides a clear solution to
the substantial funding gap Clearwire is facing . The Company's
prospects of securing the $2-$4 billion in additional funding
necessary to continue operations and the LTE build plan are highly
uncertain. In evaluating the Sprint transaction in the context of
its funding constraints, the Special Committee considered two sets
of financial projections prepared by Clearwire's management team:
-- Single-Customer Case (SCC): Assumes Sprint remains Clearwire's
only major wholesale customer, and increases its wholesale
purchases by over 500% to over $2 billion by 2020.
-- Multi-Customer Case (MCC): Requires substantial non-Sprint
network traffic beginning in 2014, which implies an immediate
agreement with another major wholesale customer.
-- Industry reality is that many carriers have recently
consolidated spectrum positions and are focused on other strategic
priorities.
-- Despite concerted efforts and discussions with more than 100
targets, Clearwire has failed to secure an additional major
wholesale customer.
Both SCC and MCC have significant funding gaps that need to be
addressed:
-- SCC: Estimated $3.9 billion peak cash shortfall in 2017.
-- MCC: Estimated $2.1 billion peak cash shortfall in 2015.
At the time Clearwire entered into the proposed Sprint
transaction, it disclosed in its third quarter 2012 filings that
the Company had 12 months of liquidity remaining, and in its first
quarter 2013 filings the Company disclosed that, even if it
curtails or suspends its LTE build, its liquidity will be depleted
in the first quarter 2014 without securing additional financing.
Moreover, the Company believes that securing the additional
financing to fund the standalone business plan would be
challenging, expensive and highly dilutive to stockholders, if
available at all.
SPRINT TRANSACTION REPRESENTS CULMINATION OF
RIGOROUS MULTI-YEAR STRATEGIC REVIEW
The Clearwire board and management undertook an extensive, multi-
year process to explore strategic and financial alternatives over
the past two years, which the Special Committee, with its
advisors, also independently evaluated, including:
Alternative #1: Additional Wholesale Partners
-- Without a second major wholesale customer, Clearwire's business
plan is exceedingly risky due to increasing dependence upon
Sprint, its largest customer, and a significant funding gap ($3.9
billion under SCC);
-- MCC is only viable with another major wholesale customer in
addition to Sprint; and
-- Success remains unlikely given industry dynamics, and potential
partners expressed a strong preference for spectrum acquisition
over a wholesale partnership due to greater control.
Conclusion: Clearwire has been unsuccessful at attracting a second
major wholesale customer, despite concerted efforts and
discussions with more than 100 targets.
Alternative #2: Monetize Excess Spectrum
-- Clearwire's exhaustive sale process in 2010 involved contacting
37 parties and did not result in an agreement;
-- Since then, Clearwire has engaged in a series of conversations
with a number of parties that did not result in any compelling
offers, including a market check conducted in December of 2012;
-- The proceeds of any sale of spectrum could be subject to
significant tax leakage and use of proceeds restrictions under
Clearwire's existing debt agreements and thereby wouldn't provide
sufficient liquidity to the Company;
-- Outstanding proposals for Clearwire's spectrum are for premium
portfolios of either primarily owned spectrum or leased spectrum
concentrated in metro markets; Clearwire is unlikely to have buyer
interest for all 47 billion MHz-POPs of spectrum above the
$0.21/MHz-POP value implied by Sprint proposal; and
-- Even a sale of a meaningful block of spectrum would leave
Clearwire exposed to significant risks and would not solve
Clearwire's long-term liquidity challenges as it does not address
the fundamental need for significant additional revenues, and
potentially reduces future demand for Clearwire's network if sold
to a potential wholesale customer.
Conclusion: A spectrum sale does not address, and may exacerbate,
long-term challenges.
Alternative #3: Financing Alternatives (Debt / Equity Financing)
-- Currently, Clearwire has an annual cash interest burden of
approximately $510 million and the interest burden created from
additional debt financing will further increase cash outflows and
potentially result in an untenable capital structure;
-- Under its current debt agreements, Clearwire has extremely
limited secured borrowing capacity remaining;
-- Fewer than 200 million available authorized shares limit our
ability to issue significant equity financing without approval
from a majority of stockholders (i.e. Sprint); and
-- New unsolicited financing offers from Crest and Aurelius are
not actionable at this time without Sprint's approval.
Conclusion: Debt or equity financing would have unattractive
terms, and would be very expensive and dilutive to existing
stockholders.
Alternative #4: Partnerships / Other Strategic Transactions
-- Clearwire would not be able to sell the whole Company as Sprint
has stated that they are not willing sellers; and
-- Under existing agreements, Clearwire's ability to offer
meaningful governance rights to new partners is limited.
Conclusion: A sale of the Company to a third party other than
Sprint is unlikely to occur due to Clearwire's governance
structure and Sprint's unwillingness to sell its stake.
Alternative #5: Financial Restructuring / Bankruptcy
-- Clearwire's difficult liquidity situation will put it in a
worse position to negotiate any other strategic transaction, and
financial restructuring may be the only available alternative;
-- Clearwire engaged Blackstone Advisory Partners and Kirkland &
Ellis LLP to explore the possibility of a financial restructuring
in fall of 2011, and has spent significant time with these
advisors to understand the implications and risks of
restructuring;
-- The process could take 24 months or longer and stockholders
would be unlikely to receive any value prior to completion; and
-- The outcome of a financial restructuring is subject to many
uncertainties, including:
? The existence of buyers in an auction for the entire Company;
? The ability to sell the entire spectrum portfolio without
flooding the market at non-distressed prices;
? Potential taxes on spectrum sales which could materially reduce
value to stockholders; and
? Potential damages claims by Sprint which could be substantial
and could reduce value to stockholders, among others.
Conclusion: Represents a highly uncertain outcome for Clearwire
stockholders, and unlikely to yield value to stockholders
exceeding $2.97 per share.
Given the comprehensive reviews of the alternatives, the Special
Committee and board of directors determined that the Sprint
transaction is in the best interests of the Company's non-Sprint
stockholders.
MAXIMIZE THE VALUE OF YOUR INVESTMENT IN CLEARWIRE. VOTE "FOR" THE
SPRINT TRANSACTION ON THE WHITE PROXY CARD
The Clearwire board unanimously recommends that you vote your
shares FOR all of the proposals relating to the proposed
transaction with Sprint by returning the WHITE proxy card with a
"FOR" vote for all proposals. The failure to vote or an
abstention has the same effect as a vote against the proposed
combination. Because some of the proposals required to close the
proposed transaction requires the affirmative vote of 75% of all
outstanding shares, the votes of all of Clearwire stockholders are
important. If stockholders do not approve the proposals related
to the proposed combination, there is no assurance that your
shares of Clearwire common stock will be able to be sold for the
same or greater value in the future.
We urge you to discard any gold proxy cards you may receive, as
they were sent by a dissident stockholder. If you previously
submitted a gold proxy card, we urge you to cast your vote as
instructed on the WHITE proxy card as soon as you receive it. A
vote on the WHITE proxy card will revoke any earlier dated proxy
card that was submitted, including any white proxy card. If you
have questions or need assistance voting your shares, please
contact our proxy solicitor, MacKenzie Partners, Inc., toll-free
at (800) 322-2885 or call collect at (212) 929-5500.
On behalf of your board of directors, we thank you for your
continued support.
Sincerely,
John Stanton
Chairman of the Board
If you have any questions, require assistance with voting your
WHITE proxy card, or need additional copies of the proxy
materials, please contact:
MacKenzie Partners, Inc.
105 Madison Avenue
New York, NY 10016
Telephone: (212) 929-5500 (Call Collect)
TOLL-FREE (800) 322-2885
E-mail: proxy@mackenziepartners.com
About Clearwire Corporation
Kirkland, Wash.-based Clearwire Corporation (NASDAQ: CLWR)
-- http://www.clearwire.com/-- through its operating
subsidiaries, is a provider of 4G mobile broadband network
services in 68 markets, including New York City, Los Angeles,
Chicago, Dallas, Philadelphia, Houston, Miami, Washington, D.C.,
Atlanta and Boston.
The Company reported a net loss attributable to the Company of
$717.33 million in 2011, a net loss attributable to the Company of
$487.43 million in 2010, and a net loss attributable to the
Company of $325.58 million in 2009.
The Company's balance sheet at Sept. 30, 2012, showed $8.14
billion in total assets, $5.86 billion in total liabilities and
$2.28 billion in total stockholders' equity.
* * *
As reported by the Troubled Company Reporter on April 10, 2013,
Standard & Poor's Ratings Services said that its 'CCC' corporate
credit rating and all other ratings on Bellevue, Wash.-based
wireless service provider Clearwire Corp. remain on CreditWatch,
where they were placed with positive implications, on Dec. 13,
2012, following the announcement that majority-owner Sprint Nextel
Corp. offered to purchase the remaining 49% stake in Clearwire
that it did not already own. It is S&P's view that this
acquisition would most likely be linked to consummation of Japan-
based SoftBank Corp.'s pending purchase of Sprint Nextel.
CNO FINANCIAL: S&P Raises Issuer Credit Rating to 'BB-'
-------------------------------------------------------
Standard & Poor's Ratings Services said that it has raised its
issuer credit and senior secured debt ratings on CNO Financial
Group Inc. (CNO) to 'BB-' from 'B+' and raised its issuer credit
and financial strength ratings on CNO's core insurance entities
(Bankers Conseco Life Insurance Co., Bankers Life & Casualty Co.,
Colonial Penn Life Insurance Co., and Washington National
Insurance Co.) to 'BBB-' from 'BB+'. At the same time, S&P
revised the outlook to stable from positive.
"Our upgrade of CNO reflects the company's continued improvement
in operating performance and statutory capitalization in the past
two years," said Standard & Poor's credit analyst Jon Reichert.
"Although it's still experiencing some recurring litigation and
reserve charges to earnings, operating performance has stabilized
considerably during the past few years. Business segment EBIT
increased 8% in first-quarter 2013, and total new annualized
premiums grew 2%."
CNO's statutory capitalization has also improved in the past
several years, with total adjusted capital increasing 2% in 2012,
and a National Assn. of Insurance Commissioners risk-based capital
ratio (RBC) rising to 367% by year-end 2012 from 332% at year-end
2010. Management has stated a longer-term RBC target of around
350%. Preliminary results from Standard & Poor's capital model
show a small redundancy at the 'BBB' level at year-end 2012 versus
a deficiency at the 'BBB' level at year-end 2011. The capital
structure of the holding company also supports the ratings, with
debt leverage of about 21% and fixed-charge coverage above 4x.
S&P's ratings on the group also reflect its good competitive
position. Excluding annuities, sales increased 12% during 2012
and 4% in the first quarter of 2013. S&P also view Bankers Life's
career agent force to be a competitive advantage for the company.
"The stable outlook reflects our expectation that CNO's
competitive position will remain good, enabling the company to
continue generating good earnings and maintain adequate statutory
capitalization," Mr. Reichert continued. "We anticipate pretax
operating earnings growth of at least 5%-10% in 2013, with similar
growth in new annualized premiums, excluding annuities. We expect
the group to maintain capital redundancy at the 'BBB' level, as
per our capital model, with debt leverage remaining below 25% and
fixed-charge coverage above 4x. Further strengthening of the
company's statutory capital position could lead to a positive
rating action."
CODA HOLDINGS: Wins Interim Approval of $5MM DIP Financing
----------------------------------------------------------
CODA Holdings, Inc., et al., now has access to $1.9 million of DIP
financing after Judge Christopher Sontchi granted interim approval
of the loans at a hearing on May 3 from the proposed buyers of the
assets. The bankruptcy judge will hold a hearing on May 20, 2013
at 10:00 a.m. to consider final approval of the DIP financing,
which would allow the Debtor to tap the remaining $3.1 million.
Objections are due May 15, 2013 at 4:00 p.m.
The $5 million delayed-draw debtor-in-possession facility is being
provided by the Debtors' prepetition secured creditors identified
as the "bridge lenders". The bridge lenders are led by FCO MA
CODA Holdings LLC, an affiliate of Fortress Investment Group, and
are comprised of certain of the secured noteholders that provided
critical bridge financing for the Debtors prepetition.
The DIP lenders have agreed to serve as the stalking horse bidder
for the Debtors' assets. They have also agreed to support a plan
of reorganization that will liquidate the Debtors' remaining
assets for the benefit of their estates, including unsecured
creditors.
The Debtors said that the DIP facility is the only financing that
they could obtain under the circumstances.
The DIP lenders will receive $1 of roll-up loans for each $1 of
DIP facility and exit facility commitments. The DIP facility also
requires the Debtors to waive rights under Section 552(b) of the
Bankruptcy Code.
The DIP facility will be secured by blanket security interests and
liens on all of the assets and properties of the Debtors' and
certain non-debtor guarantors. In return for expressly consenting
to a priming lien and the Debtors' use of cash collateral, the
secured noteholders and the holders of terms loans will receive
replacement liens.
Interest on the DIP loan will accrue at a rate of 6% per annum.
The DIP agent will receive an administrative fee of $50,000.
The DIP lenders will have the unqualified right to credit bid up
to the full amount of the DIP facility in any sale of any portion
of the Debtors' assets.
The DIP facility will mature 60 calendar days after the Petition
Date. The interest rate in an event of default will rise to 2%
above the non-default interest rate.
The failure to satisfy these sale covenants will be an event of
default under the DIP credit agreement:
* Not later than 21 calendar days after the Petition Date, the
Debtors must obtain approval of the bidding procedures;
* The Debtors must solicit binding bids not later than 30
calendar days after the Petition Date;
* The Debtors must convene an auction not later than 30
calendar days after the bidding deadline;
* The Debtors must obtain approval of the sale of
substantially all assets to one or more buyers three days after
the conclusion of the auction.
* The Debtors must consummate the approved sale not later
than 5 calendar days after entry of the sale order.
About CODA Holdings
Los Angeles, California-based CODA Energy --
http://www.codaenergy.com-- manufactures energy products based on
lithium-ion batteries, adaptive battery-management technology and
scalable system architecture. CODA Energy's products feature a
modular design that provides reliable, secure, cost-effective
solutions for a wide range of energy and power needs, including
peak shaving, load leveling, renewable energy integration,
frequency regulation, voltage support, and transmission and
distribution (T&D) upgrade deferral.
CODA Holdings, Inc., Coda Energy LLC and three other affiliates
filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No.
13-11153) on May 1, 2013, to enable the Company to complete a
sale, confirm a plan, and emerge from bankruptcy in a stronger
position to execute its new business plan. The Company expects
the sale process to take 45 days to complete.
FCO MA CODA Holdings LLC, an affiliate of Fortress Investment
Group, is leading a consortium of lenders intending to provide DIP
financing to enable the Company's energy storage business to
remain fully operational during the restructuring process. The
consortium, or its designee, will also as stalking horse bidder to
acquire the Company post-bankruptcy. In addition, the Company
will seek to monetize value of its existing automotive business
assets.
CODA disclosed assets of $10 million to $50 million and
liabilities of less than $100 million. The Debtors have incurred
prepetition a significant amount of secured indebtedness: secured
notes of with principal in the amount of $59.1 million; term loans
in the principal amount of $12.6 million; and a bridge loan with
$665,000 outstanding. FCO and other bridge loan lenders have
"enhanced priority" over other secured noteholders that did not
participate in the bridge loans, pursuant to the intercreditor
agreement.
CODA's legal advisor in connection with the restructuring is White
& Case LLP. Emerald Capital Advisors serves as its Chief
Restructuring Officer and restructuring advisor, and Houlihan
Lokey serves as its investment banker for the restructuring.
Sidley Austin LLP is serving as FCO MA CODA Holdings LLC's legal
advisor.
CODA HOLDINGS: Hearing on Rules for Fortress-Led Auction May 20
---------------------------------------------------------------
Judge Christopher S. Sontchi will convene a hearing on May 20,
2013, to consider approval of CODA Holdings, Inc., et al.'s
proposed procedures for the sale of substantially all assets.
The Debtors have signed a contract to sell the business to a
consortium of lenders led by FCO MA CODA Holdings LLC, an
affiliate of Fortress Investment Group, absent higher and better
offers at an auction.
Objections to the sale procedures are due May 15, 2013 at 4:00
p.m. The judge approved the Debtors' request to shorten the
notice and objection periods for the sale motion. The Debtors
said there's a risk of administrative insolvency if they do not
pursue a quick sale process.
The consortium of lenders, which provided the Debtors with
financing while they were marketing the assets prepetition, have
agreed to act as the stalking horse bidder in connection with the
11 U.S.C. Sec. 363 sale of a "significant portion" of the Debtors'
assets and support a plan of the reorganization that will
liquidate the assets not included in the sale.
The proposed buyers have offered to pay the Debtors $25 million in
cash plus adjustments and assumption of liabilities for the
Debtors' business. Avoidance claims and causes of action are
included in the assets to be sold. The buyers won't assume
liabilities relating to design or manufacturing defects, employees
hired by the Debtors, and claims arising under environmental laws.
The Debtors propose these bidding procedures:
* Interested parties must submit initial bids by May 31, 2013,
at 4:00 p.m.;
* Initial bids must be at least $250,000 higher than the
stalking horse bid and must include a cash deposit of
$1 million;
* If the Debtors receive at least one more qualified bids in
addition to the stalking horse bid, an auction will be
conducted on June 3, at 10:00 a.m. at the offices of White &
Case LLP, 633 West Fifth Street, Suite 1900, Los Angeles,
California;
* The Debtors will select the winning bid, as well as the second
highest and best bid to serve as the back-up bid, at the
auction; and the bank-up bid will remain binding until 20 days
after the sale order is signed by the bankruptcy court.
* Objections to the sale are due June 5, 2013 at 4:00 p.m.; and
* A sale hearing will be held on June 6, 2013 at 10:00 a.m.
About CODA Holdings
Los Angeles, California-based CODA Energy --
http://www.codaenergy.com-- manufactures energy products based on
lithium-ion batteries, adaptive battery-management technology and
scalable system architecture. CODA Energy's products feature a
modular design that provides reliable, secure, cost-effective
solutions for a wide range of energy and power needs, including
peak shaving, load leveling, renewable energy integration,
frequency regulation, voltage support, and transmission and
distribution (T&D) upgrade deferral.
CODA Holdings, Inc., Coda Energy LLC and three other affiliates
filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No.
13-11153) on May 1, 2013, to enable the Company to complete a
sale, confirm a plan, and emerge from bankruptcy in a stronger
position to execute its new business plan. The Company expects
the sale process to take 45 days to complete.
FCO MA CODA Holdings LLC, an affiliate of Fortress Investment
Group, is leading a consortium of lenders intending to provide DIP
financing to enable the Company's energy storage business to
remain fully operational during the restructuring process. The
consortium, or its designee, will also as stalking horse bidder to
acquire the Company post-bankruptcy. In addition, the Company
will seek to monetize value of its existing automotive business
assets.
CODA disclosed assets of $10 million to $50 million and
liabilities of less than $100 million. The Debtors have incurred
prepetition a significant amount of secured indebtedness: secured
notes of with principal in the amount of $59.1 million; term loans
in the principal amount of $12.6 million; and a bridge loan with
$665,000 outstanding. FCO and other bridge loan lenders have
"enhanced priority" over other secured noteholders that did not
participate in the bridge loans, pursuant to the intercreditor
agreement.
CODA's legal advisor in connection with the restructuring is White
& Case LLP. Emerald Capital Advisors serves as its Chief
Restructuring Officer and restructuring advisor, and Houlihan
Lokey serves as its investment banker for the restructuring.
Sidley Austin LLP is serving as FCO MA CODA Holdings LLC's legal
advisor.
CODA HOLDINGS: Sec. 341 Meeting of Creditors on June 3
------------------------------------------------------
There's a meeting of creditors of CODA Holdings, Inc., et al., on
June 3, 2013, at 1:00 p.m. at J. Caleb Boggs Federal Building,
Second Floor, Room 5209, in Wilmington, Delaware.
This the first meeting of creditors required under Section 341(a)
of the Bankruptcy Code in all bankruptcy cases. All creditors are
invited, but not required, to attend. This meeting of creditors
offers the one opportunity in a bankruptcy proceeding for
creditors to question a responsible office of the Debtor under
oath about the company's financial affairs and operations that
would be of interest to the general body of creditors.
About CODA Holdings
Los Angeles, California-based CODA Energy --
http://www.codaenergy.com-- manufactures energy products based on
lithium-ion batteries, adaptive battery-management technology and
scalable system architecture. CODA Energy's products feature a
modular design that provides reliable, secure, cost-effective
solutions for a wide range of energy and power needs, including
peak shaving, load leveling, renewable energy integration,
frequency regulation, voltage support, and transmission and
distribution (T&D) upgrade deferral.
CODA Holdings, Inc., Coda Energy LLC and three other affiliates
filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-
11153) on May 1, 2013, to enable the Company to
complete a sale, confirm a plan, and emerge from bankruptcy in a
stronger position to execute its new business plan. The Company
expects the sale process to take 45 days to complete.
FCO MA CODA Holdings LLC, an affiliate of Fortress Investment
Group, is leading a consortium of lenders intending to provide DIP
financing to enable the Company's energy storage business to
remain fully operational during the restructuring process. The
consortium, or its designee, will also as stalking horse bidder to
acquire the Company post-bankruptcy. In addition, the Company
will seek to monetize value of its existing automotive business
assets.
CODA disclosed assets of $10 million to $50 million and
liabilities of less than $100 million. The Debtors have incurred
prepetition a significant amount of secured indebtedness: secured
notes of with principal in the amount of $59.1 million; term loans
in the principal amount of $12.6 million; and a bridge loan with
$665,000 outstanding. FCO and other bridge loan lenders have
"enhanced priority" over other secured noteholders that did not
participate in the bridge loans, pursuant to the intercreditor
agreement.
CODA's legal advisor in connection with the restructuring is White
& Case LLP. Emerald Capital Advisors serves as its Chief
Restructuring Officer and restructuring advisor, and Houlihan
Lokey serves as its investment banker for the restructuring.
Sidley Austin LLP is serving as FCO MA CODA Holdings LLC's legal
advisor.
CODA HOLDINGS: Wins Approval to Hire KCC as Claims Agent
--------------------------------------------------------
CODA Holdings, Inc., and its affiliates won approval from the
Bankruptcy Court to hire Kurtzman Carson Consultants LLC as claims
and noticing agent to, among other things, (i) distribute the
required notices to parties in interest, (ii) receive, maintain,
docket and otherwise administer the proofs of claims filed in the
bankruptcy cases, and provide other administrative services.
Although the Debtors have not yet filed their schedules of assets
and liabilities, they anticipate that there will be in excess of
2,000 entities to be noticed.
The Debtors will pay KKC for its services, expenses and supplies
at the rates or prices in accordance with the KCC Fee Structure.
The Debtors also agree to pay the reasonable out of pocket
expenses incurred by KCC in connection with the services provided.
The document containing the Fee Structure was not included in the
application posted in KCC's Web site.
Before the bankruptcy filing, the Debtors provided KCC a retainer
in the amount of $25,000.
About CODA Holdings
Los Angeles, California-based CODA Energy --
http://www.codaenergy.com-- manufactures energy products based on
lithium-ion batteries, adaptive battery-management technology and
scalable system architecture. CODA Energy's products feature a
modular design that provides reliable, secure, cost-effective
solutions for a wide range of energy and power needs, including
peak shaving, load leveling, renewable energy integration,
frequency regulation, voltage support, and transmission and
distribution (T&D) upgrade deferral.
CODA Holdings, Inc., Coda Energy LLC and three other affiliates
filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No.
13-11153) on May 1, 2013, to enable the Company to complete a
sale, confirm a plan, and emerge from bankruptcy in a stronger
position to execute its new business plan. The Company expects
the sale process to take 45 days to complete.
FCO MA CODA Holdings LLC, an affiliate of Fortress Investment
Group, is leading a consortium of lenders intending to provide DIP
financing to enable the Company's energy storage business to
remain fully operational during the restructuring process. The
consortium, or its designee, will also as stalking horse bidder to
acquire the Company post-bankruptcy. In addition, the Company
will seek to monetize value of its existing automotive business
assets.
CODA disclosed assets of $10 million to $50 million and
liabilities of less than $100 million. The Debtors have incurred
prepetition a significant amount of secured indebtedness: secured
notes of with principal in the amount of $59.1 million; term loans
in the principal amount of $12.6 million; and a bridge loan with
$665,000 outstanding. FCO and other bridge loan lenders have
"enhanced priority" over other secured noteholders that did not
participate in the bridge loans, pursuant to the intercreditor
agreement.
CODA's legal advisor in connection with the restructuring is White
& Case LLP. Emerald Capital Advisors serves as its Chief
Restructuring Officer and restructuring advisor, and Houlihan
Lokey serves as its investment banker for the restructuring.
Sidley Austin LLP is serving as FCO MA CODA Holdings LLC's legal
advisor.
CROWN MEDIA: Reports $14.5 Million Net Income in First Quarter
--------------------------------------------------------------
Crown Media Holdings, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income and comprehensive income of $14.53 million on $85.56
million of net total revenue for the three months ended March 31,
2013, as compared with net income and comprehensive income of
$12.27 million on $83.77 million of net total revenue for the same
period during the prior year.
The Company's balance sheet at March 31, 2013, showed $995.28
million in total assets, $649.38 million in total liabilities and
$345.89 million in total stockholders' equity.
"Crown Media is off to a strong start for 2013 across all areas of
the business. We are well-positioned to maximize several
important strategies we put in place last year," said Bill Abbott,
president and CEO of Crown Media Family Networks. "We have
redoubled our commitment to establishing Hallmark Channel as an
exciting new primetime destination for original scripted series,
while substantially expanding Hallmark Movie Channel's programming
slate -- including the addition of that network's first original
Christmas movie -- to parallel its distribution and ratings
growth. With these and other exciting developments on the
horizon, we are further reinforcing Crown Media's unique value in
the marketplace and have laid a foundation that will continue to
pay off well into the future."
A copy of the Form 10-Q is available for free at:
http://is.gd/Li4GGT
About Crown Media
Studio City, Calif.-based Crown Media Holdings, Inc. (NASDAQ:
CRWN) -- http://www.hallmarkchannel.com/-- owns and operates
cable television channels dedicated to high quality, broad appeal,
entertainment programming. The Company currently operates and
distributes Hallmark Channel in both high definition (HD) and
standard definition (SD) to 90 million subscribers in the U.S.
Crown Media also operates a second 24-hour linear channel,
Hallmark Movie Channel, available in both HD and SD, which focuses
on family-friendly movies with a mix of classic theatrical films,
presentations from the acclaimed Hallmark Hall of Fame library,
original Hallmark Channel movies and special events.
Bankruptcy Warning
"Our debt agreements contain restrictions that limit our
flexibility in operating our business.
Our senior secured credit facilities and the indenture governing
the Notes contain a number of covenants that impose significant
operating and financial restrictions on us, including restrictions
on our ability to, among other things:
* incur additional debt or issue certain preferred shares;
* pay dividends on or make distributions in respect of the
Company's capital stock or make other restricted payments;
* make certain payments on debt that is subordinated or secured
on a junior basis;
* make certain investments;
* sell certain assets;
* create liens on certain assets;
* consolidate, merge, sell or otherwise dispose of all or
substantially all of our assets;
* enter into certain transactions with our affiliates; and
* designate our subsidiaries as unrestricted subsidiaries.
Any of these restrictions could limit our ability to plan for or
react to market conditions and could otherwise restrict corporate
activities. Any failure to comply with these covenants could
result in a default under our senior secured credit facilities and
the indenture governing the Notes. Upon a default, unless waived,
the lenders under our senior secured credit facilities could elect
to terminate their commitments, cease making further loans,
foreclose on our assets pledged to such lenders to secure our
obligations under the senior secured credit facilities and force
us into bankruptcy or liquidation," the Company said in its annual
report for the year ended Dec. 31, 2012.
* * *
As reported by the TCR on May 28, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Studio City,
Calif.-based cable network company Crown Media Holdings Inc. to
'B+' from 'B'. "The upgrade reflects Crown Media's recent
operating performance, which achieved higher EBITDA and lower
leverage than our expectations," said Standard & Poor's credit
analyst Deborah Kinzer.
Crown Media carries a B2 Corporate Family Rating from Moody's
Investors Service. Crown Media's B2 CFR reflects the company's
small size and niche market position among cable network
operators, concentration in two Hallmark-branded channels,
reliance on licensed third party content for a majority of its
programming, and high leverage.
DYNASTY HOTEL: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Dynasty Hotel Group, L.P.
dba Suburban Extended Stay Hotel
fdba Americas BestValue Inn of Bryan, TX
fdba Preference Inn of Bryan, TX
P.O. Box 540681
Dallas, TX 75354-0681
Bankruptcy Case No.: 13-32131
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Barbara J. Houser
Debtor's Counsel: Mark A. Castillo, Esq.
CURTIS CASTILLO PC
901 Main Street, Suite 6515
Dallas, TX 75202
Tel: (214) 752-2222
Fax: (214) 752-0709
E-mail: mcastillo@curtislaw.net
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
is available for free at http://bankrupt.com/misc/txnb13-32131.pdf
The petition was signed by Nomaan Mohammed, manager of Dynasty
Hotel Management, LLC, general partner.
EASTMAN KODAK: Formal Claim-Resolution Procedures Approved
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Eastman Kodak Co. received approval from the
bankruptcy court on May 3 for procedures to resolve disputed
claims through formalized negotiation followed by non-binding
mediation.
According to the report, the process covers pre-bankruptcy
unsecured claims, creditors claiming priority, and creditors
claiming to be secured. The process begins when Kodak asks the
claimant to put a cap, or maximum amount on the claim. If Kodak
accepts the creditor's cap, Kodak will pay the expenses of the
mediator. If not, the creditor and Kodak will share mediation
costs. The next step involves offers and counteroffers. If
there's no settlement, Kodak can designate a claim for mediation.
While the process is under way, a creditor can't initiate
proceedings in bankruptcy court to resolve a disputed claim.
The report notes that creditors aren't precluded from suing non-
bankrupt third parties even though mediation may be in process.
The process is designed in part to limit the amount of disputed
claims for which Kodak must retain a reserve once a Chapter 11
plan is approved.
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies
with strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak has been working to transform itself from
a business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped Milbank,
Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
The Retirees Committee has hired Haskell Slaughter Young &
Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper,
LLC, as Bankruptcy Consultants and Financial Advisors; and the
Segal Company, as Actuarial Advisors.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
Kodak completed the $527 million sale of digital-imaging
technology on Feb. 1, 2013. Kodak intends to reorganize by
focusing on the commercial printing business.
At the end of April 2013, Kodak filed a proposed reorganization
plan offering 85 percent of the stock to holders of the remaining
$375 million in second-lien notes. The other 15 percent is for
unsecured creditors with $2.7 billion in claims and retirees who
have a $635 million claim from the loss of retirement benefits.
ELBIT IMAGING: Delays Form 20-F for 2012
----------------------------------------
For the past few months, Elbit Imaging Ltd. has been engaged in
the process of negotiating a restructuring of its indebtedness
under eight series of publicly traded notes and two bank loan
agreements and responding to a petition filed by the trustee of
its Series B note holders with the Tel Aviv District Court calling
for the liquidation of the Company and appointment of a temporary
receiver over the Company.
As a result of the negotiation process, the Company will be filing
imminently with the Tel Aviv District Court a proposed plan of
arrangement with its creditors. Engaging in the negotiation
process and responding to these events have consumed significant
time and attention of the Company's senior management.
Accordingly, the Company was unable to file its annual report on
Form 20-F in a timely manner without unreasonable effort and
expense. The Company anticipates filing its Annual Report on Form
20-F for the year ended Dec. 31, 2012, within the regulatory
15-day extension period.
About Elbit Imaging
Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF)
hold investments in real estate and medical companies. The
Company, through its subsidiaries, also develops shopping and
entertainment centers in Central Europe and invests in and manages
hotels.
Brightman Almagor Zohar & Co., in Tel-Aviv, Israel, expressed
substantial doubt about Elbit Imaging's ability to continue as a
going concern following the financial results for the year ended
Dec. 31, 2012.
The Certified Public Accountants noted that in the period
commencing Feb. 1, 2013, through Feb. 1, 2014, the Company is to
repay its debenture holders NIS 599 million (principal and
interest). "Said amount includes NIS 82 million originally
payable on Feb. 21, 2013, that its repayment was suspended
following a resolution of the Company's Board of Directors. The
Company's Board also resolved to suspend any interest payments
relating to all the Company's debentures. In addition, as of
Dec. 31, 2012, the Company failed to comply with certain financial
covenants relating to bank loans in the total amount as of such
date of NIS 290 million.
"These matters raise substantial doubt about the Company's ability
to continue as a going concern."
EMMONS-SHEEPSHEAD: June 27 Plan Confirmation Hearing Set
--------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York has
approved the Second Amended Disclosure Statement filed by Emmons-
Sheepshead Bay Development LLC in support of its Second Amended
Plan of Reorganization dated April 5, 2013.
The Debtor is directed to transmit a copy of the Plan, the
Disclosure Statement, a Ballot conforming to the Official Forms to
all holders of Claims and interests on or before May 30, 2013.
The Court fixed June 20, 2013, as the last date by which
acceptances or rejections of the Plan must be actually received by
Robinson Brog Leinwand Greene Genovese & Gluck P.C., attorneys for
the Debtor.
The Court also fixed June 20, 2013, as the last date by which
written objections to the confirmation of the Plan must be filed
with the Court and received by Robinson Brog Leinwand Greene
Genovese & Gluck P.C., attorneys for the Debtor.
The hearing on confirmation of the Debtors' Plan will be held on
June 27, 2013, at 11:00 a.m.
According to the Second Amended Disclosure Statement, filed
April 5, 2013, the Plan provides for the reorganization of the
Debtor.
Except as otherwise set forth in the Second Amended Disclosure
Statement, payments to holders of administrative claims, subject
to offset as set forth in the Plan, will be made by the Lender on
the Effective Date. The Lender has also agreed to establish on
the Effective Date an unsecured creditors fund in the amount of
$100,000 for pro-rata distribution to holders of allowed general
unsecured claims.
All of other plan payments, including payments to the Lender, will
be funded through the sale proceeds of the Debtor's 49 currently
unsold condominium units, parking spaces and marina unit.
Proceeds of the sale from each unit will be distributed in the
following order:
1. payment of any and all reasonable and ordinary closing costs
associated with the sale of each unit;
2. reimbursement of expenses advanced post-confirmation by SDF
per each unit;
3. payment to SDF for accrued interest on its secured claim;
4. payment to SDF of the principal of its secured claim,
including any amounts for protective advances made;
5. payment to SDF on account of its administrative claim for
advances made in accordance with the Interim Financing Order
and the Final Financing Order.
6. in the event that there are excess proceeds from the sale of
the units after payment is made to 1 - 5 above, the balance
of proceeds will be distributed pro-rata to holders of
allowed unsecured claims, including the Lender's deficiency
claim.
The selling price for the units will be determined at the sole
discretion of SDF after completing a marketing analysis for the
Property.
Equity interests in the Debtor will be canceled upon the Effective
Date. Equity in the reorganized debtor will be issued to and held
by a post-confirmation trust or alternatively, a plan
administrator.
A copy of the Second Amended Disclosure Statement is available at
http://bankrupt.com/misc/emmons-sheepshead.doc71.pdf
About the Debtor
Emmons-Sheepshead Bay Development LLC is the owner of the real
property located at 3122-3144 Emmons Avenue, Brooklyn, New York,
and the sponsor of the condominium development at the Property
known as The Breakers at Sheepshead Bay Condominium. Emmons-
Sheepshead currently owns 49 unsold residential units, 43 parking
spaces and a marina at the Property. The Company filed a Chapter
11 petition (Bankr. E.D.N.Y. Case No. 12-46321) on Aug. 30, 2012,
in Brooklyn.
In its schedules, the Debtor disclosed $14,000,000 in real
property assets and $32,617,310.71 in liabilities as of the
Petition Date.
TD Bank, N.A., was the Debtor's secured lender as of the Petition
Date and the plaintiff in a series of litigations, including
mortgage foreclosure proceedings, against, amongst other
defendants, the Debtor in connection with the various loans that
were extended for the acquisition, development and construction of
the Property. On or about Oct. 16, 2012, TD sold and assigned its
various mortgages and related loan documents to SDF 17 Emmons LLC.
Judge Elizabeth S. Stong presides over the case. Arnold Mitchell
Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck
P.C., in New York, N.Y., serves as the Debtor's counsel. The
petition was signed by Jacob Pinson, the managing member of Yachad
Enterprises, LLC, the managing member of the Debtor.
ENERGY FUTURE: Incurs $569 Million Net Loss in First Quarter
------------------------------------------------------------
Energy Future Holdings Corp. filed with the U.S. Securities and
Exchange Commisison its quarterly report on Form 10-Q disclosing
a net loss of $569 million on $1.26 billion of operating revenues
for the three months ended March 31, 2013, as compared with a net
loss of $304 million on $1.22 billion of operating revenues for
the same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $40.10
billion in total assets, $51.59 billion in total liabilities and a
$11.48 billion total deficit.
"In the first quarter of 2013, we once again delivered solid
operational performance with strong safety results. In addition,
customer retention rates for our retail business continue to
improve, reflecting our commitment to customer care and product
innovation," said John Young, chief executive officer of EFH.
A copy of the Form 10-Q is available for free at:
http://is.gd/BLWYFV
The Company distributed a supplemental presentation entitled "EFH
Corp. Q1 2013 Investor Call.", a copy of which is available for
free at http://is.gd/KmuYwM
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
* * *
As reported by the TCR on Aug. 15, 2012, Moody's downgraded the
Corporate Family Rating (CFR) of EFH to Caa3 from Caa2 and
affirmed its Caa3 Probability of Default Rating (PDR) and SGL-4
Speculative Grade Liquidity Rating. The downgrade of EFH's CFR to
Caa3 from Caa2 reflects the company's financial distress and
limited financial flexibility.
In the Feb. 1, 2013, edition of the TCR, Fitch Ratings has lowered
the Issuer Default Ratings (IDR) of Energy Future Holdings Corp
(EFH) and Energy Future Intermediate Holding Company LLC (EFIH) to
'Restricted Default' (RD) from 'CCC' on the conclusion of the debt
exchange and removed the Rating Watch Negative.
As reported by the TCR on Feb. 4, 2013, Standard & Poor's Ratings
Services said it raised its corporate credit ratings on EFH, EFIH,
TCEH, and Energy Future Competitive Holdings Co. (EFCH) to 'CCC'
from 'D' following the completion of several debt exchanges, each
of which S&P considers distressed.
ENERGY TRANSFER: Fitch Raises Senior Secured Debt Ratings to 'BB'
-----------------------------------------------------------------
Fitch Ratings has upgraded the Issuer Default Rating (IDR) and
senior secured debt ratings for Energy Transfer Equity, L.P. one
notch to 'BB' and 'BB+', respectively. The ratings were removed
from Rating Watch Positive where they were placed on
March 12, 2013. ETE's Rating Outlook is Stable. Approximately
$2.7 billion of long-term debt is affected by the action.
Key Rating Drivers
Lower leverage at ETE: The April 30, 2013 sale by ETE to Energy
Transfer Partners, L.P. (ETP IDR rated 'BBB-' with a Stable
Outlook by Fitch) of its 60% interest in the holding company for
Sunoco, Inc. (SUN) and Southern Union Co. (SUG) (ETP Holdco) and
the application of $ 1.4 billion cash proceeds to reduce debt,
materially improves ETE's credit metrics. Fitch expects ETE's
adjusted debt-to-EBITDA, which measures ETE parent company debt
against the distributions it receives from its affiliates, to drop
below 3.0x in 2013 and approach 2.0x by 2015 as affiliate
distributions increase.
Increased Scale and Diversity: Recently completed merger
transactions and asset sales result in a larger, more diversified,
and generally financially stronger family of Energy Transfer
companies. On a consolidated basis the percentage of contractually
supported fee-based margins increases. For ETP and SUG, commodity
price exposure is reduced. Also, ETE's and ETP's organizational
structures have been simplified.
Summary of completed transactions: In October 2012, ETP merged
with SUN and contributed to ETP the 2% general partner (GP)
interest, incentive distribution rights, and 32.4% limited partner
(LP) interest in Sunoco Logistics Partners, L.P. (SXL IDR rated
'BBB' with a Stable Outlook). Immediately following the merger,
ETE, owner of ETP's GP, contributed its interest in SUG to ETP
Holdco in exchange for a 60% equity interest in ETP Holdco. In
conjunction with ETE's contribution, ETP contributed its interest
in SUN to ETP Holdco and retained a 40% equity interest in ETP
Holdco.
On April 30, 2013, SUG contributed its natural gas midstream
operations to ETE affiliate, Regency Energy Partners LP (RGP IDR
rated 'BB' with a Stable Outlook) for $1.5 billion comprising $900
million of RGP units and $600 million of cash. The cash proceeds
from the transaction are being used to reduce debt at SUG.
Concurrent with the RGP transaction, ETP completed its acquisition
of ETP Holdco from ETE as described above.
Pending Asset Sales: In December 2012, SUG entered into an
agreement to sell its gas utility operations for $1.015 billion of
cash and $20 million of assumed debt in a transaction expected to
close by the end of the third quarter of 2013. Proceeds will be
used to reduce debt at ETP.
ETE Affiliates' Ratings Stable: Fitch expects ETP and RGP to
manage their credit metrics and those at ETP affiliates, SUG and
Panhandle Eastern Pipeline Co. LP (PEPL) at levels to maintain
their current ratings, although the specific amount of de-
leveraging at the ETP entities resulting from the pending 2013
asset sale has not been determined. However, Fitch expects ETP's
and SUG's consolidated leverage be maintained in the 4.0x to 4.5x
range.
Liquidity Adequate: ETE has a $200 million secured credit facility
that matures on June 15, 2015. At Dec. 31, 2012, $60 million was
outstanding. All outstanding short-term borrowings are being
repaid with the ETP Holdco proceeds. The ETE credit facility, term
loan, and senior notes are secured by its ownership interests in
ETP and RGP. The revolver has a maximum permitted leverage of
5.5x, a minimum fixed charge coverage of 1.5x, and a minimum loan
to value ratio of 2.0x. ETE's operating affiliates have
significant operating flexibility with adequate liquidity and the
ability to fund their planned growth with capital market
transactions. ETE has little need to finance unless as part of an
acquisition or to refinance maturing debt. ETE's term loan matures
in 2017 and its notes mature in 2020.
Rating Sensitivities
Positive: Future developments that may, individually or
collectively, lead to positive rating action for ETE include:
-- Parent company debt to EBITDA maintained below 1.5x;
-- Improving credit profiles at ETP and RGP, the providers of
cash for ETE.
Negative: Future developments that may, individually or
collectively, lead to a negative rating action for ETE include:
-- Inability to lower leverage as anticipated;
-- Weakening credit profiles at ETP and RGP.
The following ratings have been upgraded by Fitch with a Stable
Outlook:
Energy Transfer Equity, L.P.
-- IDR to 'BB' from 'BB-';
-- Secured senior notes to 'BB+' from 'BB';
-- Secured term loan to 'BB+' from 'BB';
-- Secured revolving credit facility to 'BB+' from 'BB'.
EXCEL MARITIME: Lenders Extend Forbearance Until May 31
-------------------------------------------------------
In the context of Excel Maritime Carries Ltd.'s ongoing
discussions with its lenders under its Syndicated Credit Facility
regarding the restructuring of the Company's obligations, the
Lenders have agreed to extend the forbearance they had granted in
connection with the principal installments that have become due in
the current fiscal year through May 31, 2013. The Company's
access to the escrowed funds to fund its equity raising commitment
has been similarly extended to May 31, 2013.
Excel Maritime is engaged in ongoing discussions with its lenders
as well as investors and strategic parties regarding alternatives
for restructuring the Company's balance sheet and obtaining
additional capital funding. As a result of the Company's pursuit
of these initiatives, the Company is not able to complete the
preparation, review and filing of its annual report on Form 20-F
for the fiscal year ended Dec. 31, 2012, within the prescribed
time period without unreasonable effort or expense.
Voyage revenues are expected to decrease by $111.1 million, or
31.4%, to $242.3 million for the year ended Dec. 31, 2012,
compared to $353.4 million for the prior year. Voyage expenses
are expected to decrease by $12 million, or 25.8 percent, to $34.6
million for the year ended Dec. 31, 2012, compared to $46.6
million for the prior year.
Adjusted EBITDA for the year ended Dec. 31, 2012, was $66.6
million compared to $162.8 million for the respective year of
2011, a decrease of approximately 59 percent.
Additionally, the Company's net interest and finance costs are
expected to increase to approximately $52.3 million for the year
ended Dec. 31, 2012, compared to $35.6 million for the prior year.
About Excel Maritime
Based in Athens, Greece, Excel Maritime Carriers Ltd. --
http://www.excelmaritime.com/-- is an owner and operator of dry
bulk carriers and a provider of worldwide seaborne transportation
services for dry bulk cargoes, such as iron ore, coal and grains,
as well as bauxite, fertilizers and steel products. Excel owns a
fleet of 40 vessels and, together with 7 Panamax vessels under
bareboat charters, operates 47 vessels (5 Capesize, 14 Kamsarmax,
21 Panamax, 2 Supramax and 5 Handymax vessels) with a total
carrying capacity of approximately 3.9 million DWT. Excel Class A
common shares have been listed since Sept. 15, 2005, on the New
York Stock Exchange (NYSE) under the symbol EXM and, prior to that
date, were listed on the American Stock Exchange (AMEX) since
1998.
EXIDE TECHNOLOGIES: S&P Lowers Corp. Credit Rating to 'CCC+'
------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
corporate credit rating on Exide Technologies to 'CCC+' from 'B-'.
At the same time, S&P lowered its issue rating on Exide's
$675 million senior secured notes (due 2018) to 'CCC+' (same as
S&P's corporate credit rating on the company) from 'B-'. The
recovery rating on this debt is '4', indicating S&P's expectation
that lenders would receive average (30% to 50%) recovery in the
event of a payment default. S&P also lowered the rating on
Exide's $60 million convertible senior subordinated debt due 2013
to 'CCC-' (two notches lower than S&P's corporate credit rating).
The recovery rating is '6', indicating S&P's expectation of
negligible (0 to 10%) recovery.
All ratings remain on CreditWatch with negative implications.
The downgrade follows the company's announcement of the suspension
of its operations at its Vernon, Calif., secondary lead recycling
facility. "We believe this facility provides a meaningful portion
of Exide's internal lead requirements and an extended suspension
could impose further pressure on profitability and free operating
cash flow (FOCF) than we previously anticipated," said Standard &
Poor's credit analyst Nishit Madlani. This is likely to stem from
higher costs because Exide plans to purchase lead on the open
market and seek to negotiate tolling arrangements with third-party
lead recyclers to make up for the lost capacity.
The ratings on Exide reflects S&P's assessment of its financial
risk as "highly leveraged" and its business risk profile as
"vulnerable."
All ratings remain on CreditWatch with negative implications,
where S&P placed them on April 9, 2013, because of S&P's view of
an increased likelihood of a downgrade after the company retained
a financial advisory firm to help with financing alternatives.
The CreditWatch placement reflects at least a one-in-two
likelihood that S&P could downgrade Exide to 'CCC' or below in
S&P's next review.
S&P aims to resolve the CreditWatch listing within the next 60
days, once it has greater visibility into the company's financial
arrangements and S&P can gauge the effect of the plan on Exide'
credit quality. S&P will assess the impact of recent developments
on Exide' businesses, trade terms, liquidity, and cash flow over
its review period.
Further downward rating pressure on the company would arise if it
appears likely to engage in a debt exchange or redemption in the
next 12 months that S&P would classify as a distressed exchange.
S&P could also lower the rating if Exide's FOCF use is likely to
exceed its expectations in fiscal 2014, resulting from the
company's inability to improve its liquidity and manage working
capital requirements with a sustainable capital structure. This
would be accentuated if further headwinds to its financial
flexibility were to materialize. For instance, a delay in the
receipt of proceeds from the sale of its Frisco, Texas, property
(not S&P's base case) could limit Exide's ability to invest in
capital expenditures required to support its business prospects.
S&P could affirm the rating if Exide adopts a financing
arrangement that improves liquidity with at least modest longer-
term deleveraging prospects and if its FOCF use in fiscal 2014 is
likely to be limited to about $10 million.
FIRST DATA: Names Frank Bisignano Chief Executive Officer
---------------------------------------------------------
The Board of Directors of First Data Corporation announced that
Frank Bisignano has been named chief executive officer, effective
April 29, 2013. He will also join the First Data board of
directors concurrent with his appointment. Under the terms of the
Employment Agreement, Mr. Bisignano will earn an annual base
salary of $1,500,000.
"Frank has a proven track record of catalyzing positive change on
a global business operating in a dynamic industry. At Citigroup,
he built - from the ground up - the largest transaction services
business in the world and oversaw the largest technological and
operations businesses in the financial services industry," said
Joe Forehand, Chairman of the Board of First Data. "Frank is
known for managing technological innovation in customer-focused
businesses, and can now apply his skills and experience to leading
the largest transaction payment processing company in the world.
Frank is the ideal CEO for First Data and having an executive of
his caliber is exactly what we need to continue and grow our
leadership role in payment processing globally."
"First Data has an impressive customer-centric business and I look
forward to joining the team and building on our strong
partnerships with customers," said Frank Bisignano. "New
technological advances are impacting the payments industry every
day, making life easier for our partners, our merchants and
consumers. First Data can and should lead the way when it comes
to offering the most innovative solutions and service."
Prior to the appointment, Mr. Bisignano most recently served as
Co-Chief Operating Officer of JP Morgan Chase &Co., one of the
largest providers of banking, lending, treasury, wealth management
and investment services that serves 50 million customers,
including consumers, small businesses, mid-size companies,
corporations, financial institutions, nonprofits and governments.
In this role, his responsibilities included overseeing global
technology, real estate, operations, procurement, compliance,
regulatory control and oversight, resiliency, security and safety,
and general services for all of JPMorgan Chase's businesses in
over 60 countries. He also served on the executive and operating
committees of JP Morgan Chase.
During the housing crisis, Mr. Bisignano had the additional
responsibility of serving as CEO of Mortgage Banking, leading a
business that originates more than $155 billion in home loans
annually. Under Mr. Bisignano's leadership, the unit, the third-
largest mortgage servicer, rose to become the second largest
originator of mortgages globally and both revenues and customer
satisfaction improved dramatically.
In 2012, Mortgage Banking reported net income of $3.3 billion,
compared with a net loss of $2.1 billion in 2011 and JP Morgan
Chase saw significant improvement in satisfaction among customers
buying homes or refinancing, according to J.D. Power and
Associates. Under his leadership, JP Morgan Chase moved up in the
rankings to become the top large bank in both mortgage
originations and mortgage servicing (fourth in Mortgage Servicing,
July 2012 and fourth in Mortgage Originations, November 2012).
During this same period, he also was one of the chief architects
of the 2012 mortgage settlement that helped get the housing market
back on track.
Mr. Bisignano succeeds Ed Labry who has been serving a dual role
as both president of Retail and Alliance Services and Interim CEO
since Jan. 28, 2013. Mr. Labry will continue in his role as
president of Retail and Alliance Services.
"Ed has done an outstanding job, and we are grateful to him for
his leadership, his long-tenure at First Data and his willingness
to step in to the interim role. In addition to his managing one
of the company's largest businesses, we will continue to rely on
Ed for support during the transition and as a culture carrier at
First Data," Forehand said.
"It's been an honor to have led our great team during this period.
I look forward to working with Frank to grow First Data into an
even stronger enterprise than it is today," said Ed Labry, First
Data interim CEO and president, Retail and Alliance Services.
Prior to joining First Data, Mr. Bisignano was Co-Chief Operating
Officer for JPMorgan Chase and the CEO of Mortgage Banking at JP
Morgan Chase after being hired as Chief Administrative Officer in
2005. He also served on the firm's Operating Committee, the most
senior governing body, and the firm's Executive Committee.
Mr. Bisignano is also one of the founders of 100,000 Jobs Mission,
a coalition of companies, including JPMorgan Chase and First Data,
committed to hiring 100,000 veterans by 2020. As of April 10, the
group had reached a milestone, having hired over 64,000 veterans,
including 5,300 at JP Morgan Chase, and JP Morgan Chase was also
recently named the second best place for veterans to work, behind
only USAA, by Military Times.
Prior to JPMorgan Chase, Mr. Bisignano was the chief executive
officer for Citigroup's Global Transactions Services business and
a member of Citigroup's Management Committee. Under his leadership
(from 2002?2005), Global Transaction Services' revenue grew to $6
billion from $4 billion annually. Mr. Bisignano was also the
Chief Administrative Officer for Citigroup's Corporate and
Investment Bank, a senior executive vice president and Citigroup's
firm-wide deputy head of technology and operations. He held this
post during the 9/11 crisis and is credited with creating and
executing Citigroup's successful business continuity plan, which
involved relocating 16,000 employees displaced by the loss of 1.3
million square feet when the 7 World Trade Center building was
destroyed. At Smith Barney, he helped lead and integrate the
firm?s series of strategic acquisitions that led to the formation
of Citigroup. Prior to his career at Citi, Mr. Bisignano worked
at First Fidelity Bank from 1990-1994. During that company's
turnaround, he was an executive vice president overseeing
technology and operations, and later served as chief consumer
lending officer.
Born and raised in Brooklyn, New York, Mr. Bisignano serves on the
boards of PENCIL, the National September 11 Memorial and Museum.
He is also on the board of JPMorgan Chase Bank N.A. and the Board
of Trustees of Continuum Health Partners. He is also a trustee
for the Battery Conservancy and St. Patrick's Cathedral. He was
previously vice chairman of the Options Clearing Corporation and a
board member for the Depository Trust and Clearing Corporation,
the Alliance for Downtown New York and the Lower Manhattan
Cultural Council.
In 2010, he received the Chancellor's Medal for Outstanding
Achievement from Syracuse University for his leadership in
training the next generation of Chief Information Officers through
the creation of a new interdisciplinary technology curriculum,
with a focus on technology, business and engineering.
Mr. Bisignano graduated from Newport University. He is married
with three children. He was born on Aug. 9, 1959.
A copy of the Form 8-K is available for free at:
http://is.gd/o3gLg5
About First Data
Based in Atlanta, Georgia, First Data Corporation provides
commerce and payment solutions for financial institutions,
merchants, and other organizations worldwide.
For the 12 months ended Dec. 31, 2012, the Company incurred a net
loss attributable to the Company of $700.9 million, compared with
a net loss attributable to the Company of $516.1 million during
the prior year. The Company's balance sheet at March 31, 2013,
showed $44.50 billion in total assets, $42.24 billion in total
liabilities $69.1 million in redeemable noncontrolling interest
and $2.19 billion in total equity.
* * *
The Company's carries a 'B3' corporate family rating, with a
stable outlook, from Moody's Investors Service, a 'B' corporate
credit rating, with stable outlook, from Standard & Poor's, and
a 'B' long-term issuer default rating from Fitch Ratings.
FIRST QUALITY: Moody's Gives B2 CFR & Rates $500MM Unsec. Notes B2
------------------------------------------------------------------
Moody's Investors Service assigned a first time Ba3 Corporate
Family Rating (CFR) and Ba3-PD Probability of Default Rating to
First Quality Finance Company, Inc. (Issuer). Concurrently,
Moody's assigned a B2 rating to the company's proposed $500
million senior unsecured note offering.
Proceeds from the notes are expected to be used to refinance the
company's existing secured bank facilities and repay other
indebtedness along with proceeds from a new $1.05 billion
revolving credit facility expiring 2018 (unrated) and a $550
million term loan facility due 2018 (unrated). The rating outlook
is stable.
The following ratings have been assigned subject to the review of
final documentation:
Corporate Family Rating of Ba3
Probability of Default Rating of Ba3-PD
$500 million senior unsecured notes due May 2021 of B2 (LGD 5,
86%)
The rating outlook is stable
Ratings Rationale:
The Ba3 CFR reflects the Issuer and its sister companies position
as a leading maker of primarily private label family care
products, its diverse distribution in retail and institutional
channels, and its strong manufacturing capabilities and vertical
integration. The rating benefits from the company's consistent
profitability, strong cash flow from operations and modest
leverage (3.2 times including Moody's standard adjustments). These
positive credit factors are offset by limited free cash flow due
to significant growth capital expenditure requirements and
distributions to owners and a relatively small branded product
portfolio in a largely branded category. First Quality's
relatively modest scale of roughly $2 billion in revenue limits
its pricing flexibility -- especially given its high customer
concentration and participation in a highly competitive category
dominated by substantially larger players.
Moody's expects First Quality's liquidity to be adequate in the
next 12 to 18 months characterized by a lack of material near-term
debt maturities offset by minimal cash balances and heavy reliance
on its committed revolving credit facility. In Moody's view, the
company's still high capital expenditures will require meaningful
reliance on its $1.05 billion revolver expiring 2018. While
Moody's anticipates that availability will be adequate, the
potential for additional growth projects and/or acquisitions could
limit excess availability. Moody's anticipates that First Quality
will distribute all available free cash flow to its owners via
dividend payments.
First Quality's proposed $1.05 billion senior secured revolving
credit and $550 million term loan are guaranteed by certain
domestic sister companies of the Issuer and their domestic
subsidiaries. The secured facilities benefit from a first lien
priority on the assets of the Issuer, certain domestic sister
companies and their domestic subsidiaries.
The proposed $500 million senior unsecured notes are jointly and
severally guaranteed on a senior unsecured basis by each entity
that is a borrower or guarantor under the senior secured credit
facilities. The senior notes are rated two notches below the
company's CFR as they are effectively subordinated to a large
amount of secured debt in the capital structure.
The stable outlook reflects Moody's expectation of moderate
earnings growth, minimal deleveraging and stable financial
policies.
Ratings could be upgraded if First Quality demonstrates a track
record of consistent and prudent financial policies with improved
liquidity and free cash flow. Further, the company would need to
exhibit successful management of planned growth initiatives.
Ratings could be downgraded if First Quality's significant capital
investments fail to sustain profitable revenue growth or if
operating difficulties or increased competition causes
profitability to decline materially. Specifically, the ratings
could be downgraded if EBIT margins fall below 12% or debt-to-
EBITDA rises above 4.5 times.
The principal methodology used in this rating was the Global
Packaged Goods published in December 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.
First Quality, based Great Neck, NY, is a manufacturer of private
label and branded personal care products to retail, institutional,
healthcare, and commercial markets. Products include family care,
consumer towel and tissue, and bottled water products (90.5%) and
rolled goods (9.5%). More than 90% of the company's $2 billion
sales for the period ending December 31, 2012 were private label.
First Quality is 100% owned by members of the Damaghi family.
FIRST QUALITY: S&P Assigns BB CCR & Rates $500MM Unsec. Notes BB-
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'BB' corporate
credit rating to Great Neck, N.Y.-based First Quality Enterprises
Inc. The outlook is stable.
At the same time, S&P assigned 'BBB-' issue ratings and '1'
recovery ratings to the $1.6 billion senior secured credit
facilities, composed of a five-year $1.05 billion revolving credit
facility and a five-year $550 million term loan. The '1' recovery
ratings indicate S&P's expectation of very high recovery (90% to
100%) for senior secured creditors in the event of a payment
default.
S&P also assigned a 'BB-' issue rating and '5' recovery rating to
the $500 million senior unsecured notes due 2021. The '5'
recovery rating indicates S&P's expectation of modest recovery
(10% to 30%) for senior unsecured creditors in the event of a
payment default. First Quality Finance Co. Inc. is the issuer
of the unsecured notes.
The ratings on First Quality reflect Standard & Poor's assessment
of the company's stable position in the private-label disposable
personal care products market, and its weak bargaining power with
the customers representing the majority of its business,
heightened by significant customer concentration with Walmart and
Sam's Club. The ratings also reflects S&P's assessment of the
company's high capital investments, adequate liquidity, and S&P's
forecast for leverage in the low-3x area, funds from operations-
to-total debt in the low-20% area, and EBITDA interest coverage
above 7.5x.
"We view First Quality's financial policy as aggressive primarily
because of the risks associated with the substantial expansion
plan, which is intended to grow and develop additional products
and services," said Standard & Poor's credit analyst Brian
Milligan. "We forecast the majority of cash flows will be
directed to reinvestment in the business and, secondarily, to
shareholder distributions."
There is stable end-user demand for First Quality's products,
including adult care and infant care (its most established
businesses, in S&P's view), feminine care, tissue, and towel. "We
expect these categories to grow in line with population growth and
that it will be difficult for the company to significantly
increase share, as it competes with companies with substantially
greater financial resources," said Mr. Milligan.
The outlook is stable, which reflects Standard & Poor's
expectation the company's market position with its existing
customers will remain stable and that it will benefit from its new
product introductions. S&P believes increased debt from further
business reinvestment will offset its forecasted profit growth,
resulting in credit metrics remaining approximately unchanged
during 2013 and 2014.
FLAT OUT CRAZY: Restaurant Sales Approved; Exclusivity Sought
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the owner of the Flat Top Grill and Stir Crazy Asian
Grill restaurants now has formal court approval to sell both
operations for about $8.6 million in secured debt and about
$2.2 million cash. The buyer for both is secured lender
HillStreet Fund IV LP.
According to the report, the sale of the 14 Flat Top stores was
officially approved on April 29 by the U.S. Bankruptcy Court in
Manhattan. The 11-store Stir Crazy sale was approved later last
week.
The report notes that Stir Crazy sale approval was slowed by a
dispute over an alleged lease. The bankruptcy judge eventually
decided that the lease in reality was a disguised financing. As a
result, the bankrupt restaurants weren't required to jump over
higher hurdles required for dealing with leases as compared with
financings.
The company, the report discloses, filed papers last week asking
the judge to extend exclusive plan-filing rights by two months to
July 24. There will be a May 23 hearing on the exclusivity
motion.
About Flat Out Crazy
Flat Out Crazy LLC and its affiliates operate two Asian-inspired
restaurant chains that began in Chicago. Flat Top Grill, which
currently has 15 locations, is a full-service fast-casual create-
your-own stir-fry concept. Stir Crazy Fresh Asian Grill, which
has 11 locations, is a full-service casual Asian restaurant
offering the flavors of Chinese, Japanese, Thai and Vietnamese
food. The Debtors have 1,200 employees.
Flat Out Crazy and 13 affiliates sought Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 13-22094) in White Plains, New York
on Jan. 25, 2013. The Debtors have tapped Squire Sanders (US) LLP
as counsel; Kurtzman Carson Consultants, LLC, as claims, noticing
and administrative agent; William H. Henrich and Mark Samson from
Getzler Henrich as their co-chief restructuring officers; and J.H.
Chapman Group, L.L.C, as their investment bankers.
The Debtor disclosed $24,339,542 in assets and $15,899,166 in
liabilities as of the Chapter 11 filing.
An official committee of unsecured creditors has been appointed in
the Debtors' cases. The Committee tapped to retain Kelley Drye &
Warren LLP as its counsel and CBIZ Accounting, Tax and Advisory of
New York, LLC as financial advisor.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed Alan
Chapell, as the consumer privacy ombudsman in the Debtors' cases.
FONTAINEBLEAU LAS VEGAS: NY Judge Ships BofA's Doc Spat to Fla.
---------------------------------------------------------------
Gavin Broady of BankruptcyLaw360 reported that a New York federal
judge on Thursday rejected a bid by several insurers to dismiss a
Bank of America NA suit over the failed $2.9 billion Fontainebleau
casino project and shipped the case to Florida to be folded into
Fountainbleau's bankruptcy proceedings.
According to the report, Judge Victor Marrero said the suit, in
which BofA seeks a court order allowing it to withhold loan
administration documents, properly belongs in Florida alongside
the related bankruptcy proceedings. BofA is facing ongoing
litigation brought by certain project lenders over its alleged
mismanagement of the casino project, the report recalled.
About Fontainebleau Las Vegas
Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- was
planned as a hotel-casino on property along the Las Vegas Strip.
Its developer, Fontainebleau Las Vegas Holdings LLC and
affiliates, filed for Chapter 11 protection (Bankr. S.D. Fla. Lead
Case No. 09-21481) on June 9, 2009.
Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP,
represented the Debtors in their restructuring effort. Kurtzman
Carson Consulting LLC served as the Debtors' claims agent.
Attorneys at Genovese Joblove & Battista, P.A., and Fox
Rothschild, LLP, represented the Official Committee of Unsecured
Creditors. Fontainebleau Las Vegas LLC estimated more than
$1 billion in assets and debts, while each of Fontainebleau Las
Vegas Capital Corp. and Fontainebleau Las Vegas Holdings LLC
estimated less than $50,000 in assets.
In February 2010, Icahn Enterprises L.P. acquired Fontainebleau
for roughly $150 million. The bankruptcy case was subsequently
converted to Chapter 7. Soneet R. Kapila has been named the
trustee for the Chapter 7 case of Fontainebleau Las Vegas.
FREESEAS INC: Issues Add'l 325,000 Settlement Shares to Hanover
---------------------------------------------------------------
The Supreme Court of the State of New York, County of New York,
entered an order on April 17, 2013, approving, among other things,
the fairness of the terms and conditions of an exchange pursuant
to Section 3(a)(10) of the Securities Act of 1933, as amended, in
accordance with a stipulation of settlement between FreeSeas Inc.,
and Hanover Holdings I, LLC, in the matter entitled Hanover
Holdings I, LLC v. FreeSeas Inc., Case No. 153183/2013. Hanover
commenced the Action against the Company on April 8, 2013, to
recover an aggregate of $1,792,416 of past-due accounts payable of
the Company, plus fees and costs. The Order provides for the full
and final settlement of the Claim and the Action. The Settlement
Agreement became effective and binding upon the Company and
Hanover upon execution of the Order by the Court on April 17,
2013.
Pursuant to the terms of the Settlement Agreement approved by the
Order, on April 17, 2013, the Company issued and delivered to
Hanover 560,000 shares of the Company's common stock, $0.001 par
value, and on April 22, 2013, the Company issued and delivered to
Hanover 300,000 Additional Settlement Shares.
The Settlement Agreement provides that the Initial Settlement
Shares will be subject to adjustment on the trading day
immediately following the Calculation Period to reflect the
intention of the parties that the total number of shares of Common
Stock to be issued to Hanover pursuant to the Settlement Agreement
be based upon a specified discount to the trading volume weighted
average price of the Common Stock for a specified period of time
subsequent to the Court's entry of the Order.
The Settlement Agreement provides that in no event will the number
of shares of Common Stock issued to Hanover or its designee in
connection with the Settlement Agreement, when aggregated with all
other shares of Common Stock then beneficially owned by Hanover
and its affiliates result in the beneficial ownership by Hanover
and its affiliates (as calculated pursuant to Section 13(d) of the
Exchange Act and the rules and regulations thereunder) at any time
of more than 9.99% of the Common Stock.
Since the issuance of the Initial Settlement Shares and Additional
Settlement Shares described above, Hanover demonstrated to the
Company's satisfaction that it was entitled to receive 325,000
Additional Settlement Shares and that the issuance of those
Additional Settlement Shares to Hanover would not result in
Hanover exceeding the beneficial ownership limitation set forth
above. Accordingly, on April 29, 2013, the Company issued and
delivered to Hanover 325,000 Additional Settlement Shares pursuant
to the terms of the Settlement Agreement approved by the Order.
The issuance of Common Stock to Hanover pursuant to the terms of
the Settlement Agreement approved by the Order is exempt from the
registration requirements of the Securities Act pursuant to
Section 3(a)(10) thereof, as an issuance of securities in exchange
for bona fide outstanding claims, where the terms and conditions
of such issuance are approved by a court after a hearing upon the
fairness of those terms and conditions at which all persons to
whom it is proposed to issue securities in such exchange shall
have the right to appear.
A copy of the Form 8-K is available for free at:
http://is.gd/akwxT8
About FreeSeas Inc.
Headquartered in Athens, Greece, FreeSeas Inc., formerly known as
Adventure Holdings S.A., was incorporated in the Marshall Islands
on April 23, 2004, for the purpose of being the ultimate holding
company of ship-owning companies. The management of FreeSeas'
vessels is performed by Free Bulkers S.A., a Marshall Islands
company that is controlled by Ion G. Varouxakis, the Company's
Chairman, President and CEO, and one of the Company's principal
shareholders.
The Company's fleet consists of six Handysize vessels and one
Handymax vessel that carry a variety of drybulk commodities,
including iron ore, grain and coal, which are referred to as
"major bulks," as well as bauxite, phosphate, fertilizers, steel
products, cement, sugar and rice, or "minor bulks." As of Oct.
12, 2012, the aggregate dwt of the Company's operational fleet is
approximately 197,200 dwt and the average age of its fleet is 15
years.
Freeseas disclosed a net loss of US$30.88 million in 2012, a net
loss of US$88.19 million in 2011, and a net loss of US$21.82
million in 2010. The Company's balance sheet at Dec. 31, 2012,
showed $114.35 million in total assets, $106.55 million in total
liabilities and $7.80 million in total shareholders' equity.
RBSM LLP, in New York, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2012. The independent auditors noted that the Company has
incurred recurring operating losses and has a working capital
deficiency. In addition, the Company has failed to meet scheduled
payment obligations under its loan facilities and has not complied
with certain covenants included in its loan agreements. It has
also failed to make required payments to Deutsche Bank Nederland
as agreed to in its Sept. 7, 2012, amended and restated facility
agreement and received notices of default from First Business
Bank. Furthermore, the vast majority of the Company's assets are
considered to be highly illiquid and if the Company were forced to
liquidate, the amount realized by the Company could be
substantially lower that the carrying value of these assets.
These conditions among others raise substantial doubt about the
Company's ability to continue as a going concern.
GASCO ENERGY: Common Stock Trades on OTCQB Marketplace
------------------------------------------------------
Gasco Energy, Inc., received notification from the NYSE MKT LLC
that the Exchange had filed, on April 29, 2013, a Form 25-NSE with
the Securities and Exchange Commission in order to strike the
Company's common stock from listing and registration on the
Exchange as a result of the Company's failure to maintain
compliance with Sections 1003(a)(iv) (substantial sustained losses
or impaired financial condition) and 1003(f)(v) (low selling
price) of the NYSE MKT LLC Company Guide. The Company's common
stock began trading on the OTCQB Marketplace on April 26, 2013,
and is currently quoted under the ticker symbol "GSXN."
About Gasco Energy
Denver-based Gasco Energy, Inc. -- http://www.gascoenergy.com--
is a natural gas and petroleum exploitation, development and
production company engaged in locating and developing hydrocarbon
resources, primarily in the Rocky Mountain region and in
California's San Joaquin Basin. Gasco's principal business is the
acquisition of leasehold interests in petroleum and natural gas
rights, either directly or indirectly, and the exploitation and
development of properties subject to these leases. Gasco focuses
its drilling efforts in the Riverbend Project located in the Uinta
Basin of northeastern Utah, targeting the oil-bearing Green River
Formation and the natural gas-prone Wasatch, Mesaverde, Blackhawk,
Mancos, Dakota and Morrison formations.
In its auditors' report on the consolidated financial statements
for the year ended Dec. 31, 2012, KPMG LLP, in Denver, Colorado,
expressed substantial doubt about Gasco Energy's ability to
continue as a going concern. The independent auditors noted that
the Company has suffered recurring losses and negative cash flows
from operations.
The Company reported a net loss of $22.2 million on $8.9 million
of revenues in 2012, compared with a net loss of $7.3 million on
$18.3 million of revenues in 2011. The Company's balance sheet at
Dec. 31, 2012, showed $53.9 million in total assets, $36.2 million
in total liabilities, and stockholders' equity of $17.7 million.
According to the annual report for the year ended Dec. 31, 2012,
to continue as a going concern, the Company must generate
sufficient operating cash flows, secure additional capital or
otherwise pursue a strategic restructuring, refinancing or other
transaction to provide it with additional liquidity. "The Company
has engaged a financial advisor to assist it in evaluating such
potential strategic alternatives. It is possible these strategic
alternatives will require the Company to make a pre-package, pre-
arranged or other type of filing for protection under Chapter 11
of the U.S. Bankruptcy Code."
GATEHOUSE MEDIA: Incurs $17.6 Million Net Loss in First Quarter
---------------------------------------------------------------
Gatehouse Media, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $17.62 million on $110.91 million of total revenues for the
three months ended March 31, 2013, as compared with a net loss of
$13.37 million on $117.97 million of total revenues for the three
months ended April 1, 2012.
The Company's balance sheet at March 31, 2013, showed $446.06
million in total assets, $1.29 billion in total liabilities and a
$844.17 million total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/krtA4b
About GateHouse Media
GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications. GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.
For the 12 months ended Dec. 30, 2012, the Company incurred a net
loss of $30.33 million, as compared with a net loss of $22.22
million for the 12 months ended Jan. 1, 2012.
Bankruptcy Warning
"Our ability to make payments on our indebtedness as required
depends on our ability to generate cash flow from operations in
the future. This ability, to a certain extent, is subject to
general economic, financial, competitive, legislative, regulatory
and other factors that are beyond our control.
"There can be no assurance that our business will generate cash
flow from operations or that future borrowings will be available
to us in amounts sufficient to enable us to pay our indebtedness
or to fund our other liquidity needs. Currently we do not have
the ability to draw upon our revolving credit facility which
limits our immediate and short-term access to funds. If we are
unable to repay our indebtedness at maturity we may be forced to
liquidate or reorganize our operations and business under the
federal bankruptcy laws," the Company said in its annual report
for the year ended Dec. 30, 2012.
GENMAR HOLDINGS: 8th Cir. Tosses David Scot Lynd's Appeal
---------------------------------------------------------
The U.S. Court of Appeals for the Eighth Circuit rejected David
Scot Lynd's pro se appeal from a Bankruptcy Court order denying
his Motion for Reconsideration of Claim in the bankruptcy case of
Genmar Holdings, Inc.
Mr. Lynd filed a claim on November 17, 2009, and an amended claim
on June 7, 2010, against Wood Manufacturing Company Inc., a
debtor-affiliate of Genmar Holdings, for "restitution" in the
amount of $678,799.18.
On November 27, 2009, Debtor Genmar Holdings, Inc. filed a Motion
for Orders authorizing the Debtors to, inter alia, sell assets
free and clear of liens, claims, interests and encumbrances. A
hearing on the Sale Motion was held on December 8, 2009 and the
Bankruptcy Court entered an Order on December 14, 2009 approving
and authorizing the requested relief. Pursuant to that Order, the
Debtors received bids and conducted an auction on January 7 and 8,
2010. On January 14, 2010, following a hearing, the Bankruptcy
Court issued an order approving the sale of the majority of the
Debtor's assets to Project Boat Holdings, LLC.
On August 10, 2010 and September 10, 2010, Mr. Lynd filed
identical Motions for Payment of Monies Due for Restitution in
which he demanded immediate payment of his claim. On September 17,
2010, the Debtors filed an objection to the motion because it was
premature and because Mr. Lynd's claim, if allowed, did not
entitle him to immediate payment for "restitution." On September
23, 2010, the Bankruptcy Court issued an Order denying Mr. Lynd's
Motion. On October 5, 2010, Mr. Lynd filed a Notice of Appeal from
the 2010 Order.
On November 22, 2010, while Mr. Lynd's appeal was pending, he
filed with the Bankruptcy Court a "Motion Request for
Clarification of Order" requesting clarification of the 2010 Order
to determine which entity or individual would be responsible for
paying his "restitution" claim "now and after the completion of
the Bankruptcy case," given that Genmar Corporation's assets had
been sold.
On November 23, 2010, the case was converted from Chapter 11 to
Chapter 7, and on November 24, 2010, the Bankruptcy Court
terminated the joint administration of the cases.
On December 14, 2010, the Bankruptcy Court denied Mr. Lynd's
"Motion Request for Clarification of Order" because, the Court
concluded, it sought legal advice. The Court noted, however, "that
the earlier motion for payment was denied because, although the
movant's claim might have been a nondischargeable debt in the
Chapter 11 case, it was not entitled to administrative or priority
payment from the estate of the jointly administered debtor who was
liable. It will not be discharged in the Chapter 7 case either
because Chapter 7 corporate debtors do not receive discharges."
On March 8, 2011, the Bankruptcy Appellate Panel dismissed Mr.
Lynd's appeal for failure to pay the filing fee. Mr. Lynd appealed
to the Eighth Circuit Court of Appeals, which ultimately dismissed
the appeal on December 19, 2011, for procedural reasons. The
formal mandate was issued by the Eighth Circuit on February 2,
2012.
On January 25, 2013, Mr. Lynd filed a "Motion for Reconsideration
of Claim" pursuant to Federal Rule of Bankruptcy Procedure 3008.
Although Mr. Lynd's Motion for Reconsideration of Claim does not
specifically mention which Order he sought reconsideration of, the
Chapter 7 Trustee opposed the Motion on the ground that, since the
Bankruptcy Court had not denied Mr. Lynd's claim, the Motion
seeking reconsideration under Rule 3008 was premature. On February
28, 2013, the Bankruptcy Court issued an Order denying Mr. Lynd's
Motion for Reconsideration of Claim. On March 14, 2013, Mr. Lynd
filed a Notice of Appeal mentioning due process and equal
protection grounds, as well as "the actual motion denial."
According to Bankruptcy Judge Arthur B. Federman, who penned the
BAP's opinion, "As the Trustee asserts, it is not altogether clear
what relief Mr. Lynd sought in his January 25, 2013 Motion for
Reconsideration of Claim, or what relief he seeks in this appeal.
If he is requesting reconsideration of the 2010 Order denying his
request to pay his "restitution" claim immediately, this appeal is
out of time and we lack jurisdiction to review it.4 If he is
requesting relief from the January 14, 2010 Order approving the
sale of assets, or the November 23, 2010 Order converting the case
to Chapter 7, he is, again, out of time. To the extent he seeks
reconsideration of the allowance or disallowance of his claim,
both his Motion and this appeal are premature because the
Bankruptcy Court has not yet ruled on the allowance or
disallowance of his claim."
The appeal is, David Scot Lynd, Claimant-Appellant, v. Charles W.
Ries, Trustee-Appellee, No. 13-6011 (8th Cir.). A copy of the
Eighth Circuit's May 3, 2013 decision is available at
http://is.gd/u8zeTnfrom Leagle.com.
About Genmar Holdings
Pulaski, Wisconsin-based Carver Italia, LLC, and its affiliates,
including Genmar Holdings, Inc. -- http://www.genmar.com/-- were
the world's second-largest manufacturer of fiberglass powerboats.
The company generated $460 million in annual revenue making boats
using brand names including Carver, Four Winns, Glastron, Larson,
and Wellcraft.
On June 1, 2009, Genmar Holdings, Inc., and 22 subsidiaries,
including Wood Manufacturing Company, Inc., filed voluntary
Chapter 11 petitions (Bankr. D. Minn. Case No. 09-33773) in the
District of Minnesota. The cases were being jointly administered.
Carver Italia estimated $10 million to $50 million in assets and
$100 million to $500 million in debts.
James L. Baillie, Esq., and Ryan Murphy, Esq., at Fredrikson &
Byron, PA, assisted the Debtors in their restructuring efforts.
Manchester Companies, Inc., was named Chief Restructuring Officer
of Genmar.
In early 2010, Genmar obtained approval to sell its assets in an
auction. Platinum Equity acquired essentially all of the assets
for $70 million. J&D Acquisitions bought the Carver/Marquis
brands for $6.05 million. MCBC Hydra Boats purchased the Hydra-
Sport business for $1 million.
The case was subsequently converted to Chapter 7 liquidation and
the Office of the U.S. Trustee for Region 12 appointed Charles W.
Ries as Chapter 7 case trustee.
GGW BRANDS: 'Girls Gone Wild' Trustee Gets Subpoena Power
---------------------------------------------------------
Matt Chiappardi of BankruptcyLaw360 reported that a bankruptcy
judge in California gave the go-ahead Thursday for the trustee in
the Chapter 11 case of "Girls Gone Wild" to issue subpoenas as he
investigates alleged mismanagement and whether founder Joe Francis
has been plundering the raunchy company's assets for himself.
According to the report, former FBI agent R. Todd Neilson,
appointed trustee in April, made the request for subpoena power
Monday in the U.S. Bankruptcy Court for the Central District of
California, and he said he intends to interview employees,
executives and other parties connected to GGW.
About GGW Brands
Santa Monica, California-based GGW Brands, LLC, the company behind
the "Gils Gone Wild" video, filed a Chapter 11 petition (Bankr.
C.D. Cal. Case No. 13-15130) on Feb. 27, 2013. Judge Sandra R.
Klein oversees the case. The company is represented by the Law
Offices of Robert M. Yaspan. The company disclosed $0 to $50,000
in estimated assets and $10 million to $50 million in estimated
liabilities in its petition.
Affiliates GGW Events LLC, GGW Direct LLC and GGW Magazine LLC
also sought Chapter 11 protection.
In April 2013, R. Todd Neilson, an ex-FBI agent, was appointed as
Chapter 11 Trustee to take over the companies. Mr. Neilson has
investigated failed solar-power company Solyndra and was involved
in the Mike Tyson and Death Row Records bankruptcy cases.
GLOBAL GREEN: Incurs C$469K Net Loss in Fiscal 3rd Quarter
-----------------------------------------------------------
Global Green Matrix Corporation reported a net loss of C$469,049
on C$31,363 of total revenue for the three months ended Sept. 30,
2012, compared with a net loss of C$116,195 on C$nil revenue for
the same period in 2011.
For the nine months ended Sept. 30, 2012, the Company had a net
loss of C$1,074,973 on C$174,651 of total revenue, compared with a
net loss of $266,824 on C$nil revenue for the same period of 2011.
The Company's balance sheet at Sept. 30, 2012, showed
C$3.5 million in total assets, C$1.4 million in total current
liabilities, and equity of C$2.1 million.
Global Green Matrix said: "The Company incurred a net loss for the
nine months ended Sept. 30, 2012, of C$1,074,973 (2011 -
C$266,824) with a total cumulative operating deficit of
C$12,359,670 (Dec. 31, 2011 - C$11,284,697). There is substantial
doubt about the Company's ability to continue as a going concern."
A copy of the Company's Condensed Interim Consolidated Financial
Statements for the nine months ended Sept. 30, 2012, is available
for free at http://is.gd/IiylWj
A copy of the Management Discussion & Analysis for the nine months
ended Sept. 30, 2012, is available at http://is.gd/WO7Iz0
About Global Green
Headquartered in Vancouver, Canada, Global Green Matrix Corp.,
formerly Poly-Pacific International Inc., was incorporated under
the Alberta Business Corporations Act on Oct. 25, 1995. The
Company provides environmentally sound, economically feasible
technologies to convert a wide variety of waste streams into
useable products.
* * *
As reported in the TCR on July 5, 2012, K.R. Margetson Ltd., in
Vancouver, Canada, expressed substantial doubt about Global
Green's ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that the Company has suffered recurring
losses from operations and has a net working capital deficiency.
GULF FLEET: Trustee Can Recover $9,105 Transfer to Southern Crane
-----------------------------------------------------------------
In the adversary complaint ALAN GOODMAN, TRUSTEE OF THE GULF FLEET
LIQUIDATING TRUST, Plaintiff, v. SOUTHERN CRANE & HYDRAULICS, LLC,
Defendant, Adv. Case No. 12-05048 (Bankr. W.D. La.), Judge Robert
Summerhays ruled in favor of the Trustee on his Section 547 claims
with respect to the April 19, 2010 transfer totaling $9,105.03.
With respect to the other transfers challenged by the Trustee, the
Court ruled that the Trustee take nothing on his claims. A copy
of the Court's April 23, 2013 Decision is available at
http://is.gd/xpPxtufrom Leagle.com.
Under the Complaint, the Trustee challenged four payments made by
Gulf Fleet Holdings Inc. to Southern Crane & Hydraulics, LLC,
totaling $99,839.15. The payment covered seven notices dated
between November 25, 2009 and January 13, 2010.
About Gulf Fleet
Lafayette, Lousiana-based Gulf Fleet Holdings, Inc. -- along with
affiliates Star Marine, LLC; Gulf Wind, LLC; Gulf Service, LLC;
Gulf Worker, LLC; Hercules Marine, LLC; Gulf Fleet, LLC; Gulf
Fleet Marine, Inc.; Gulf Fleet Management, LLC; Gulf Fleet
Offshore, LLC; and Gulf Ocean Marine Services, LLC -- filed for
Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. W.D. La.
Case No. 10-50713).
Gulf Fleet owned and operated a fleet of offshore and fast supply
vessels that supported oil and gas exploration and production
companies and other oilfield service companies. Gulf Fleet also
operated an independent vessel brokerage business.
Gulf Fleet estimated $100 million to $500 million in assets and
$50 million to $100 million in debts in its Chapter 11 petition.
In their schedules, affiliate Gulf Fleet, LLC, disclosed
$2,088,277 in assets and $83,891,116 in liabilities; Gulf Fleet
Management, LLC, disclosed $943,256 in assets and $45,071,399 in
liabilities; and Gulf Ocean Marine Services, LLC, disclosed
$15,777,138 in assets and $79,513,230 in liabilities.
R. Michael Bolen, U.S. Trustee for Region 5 appointed seven
members to the official committee of unsecured creditors. The
Committee was represented by Alan H. Goodman, Esq., at Breazeale,
Sachse & Wilson, L.L.P., and Hugh M. Ray, Jr., Esq., at Andrews &
Kurth.
HAMPTON LAKE: Hilton Head Project Files for Ch. 11 With Plan
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Hampton Lake LLC, the developer of the 950-acre
Hampton Lake subdivision in Bluffton, South Carolina, has a
Chapter 11 plan that contemplates selling the remaining 235 lots
over the next three years to generate cash covering payments to
creditors under the plan.
Court papers list the property as worth $22.8 million. The first-
lien mortgage holder is owed $19.4 million, with claims totaling
$48.4 million. An affiliate has a $2.3 million second mortgage.
There is also $26.3 million owing on unsecured notes. The plan
calls for paying about 88.5 percent of the first-lien debt by
selling out the project in the next three years. The noteholders
are slated for an 8.75 percent recovery. The affiliate will
subordinate its claim.
About Hampton Lake
Hampton Lake, LLC, filed a Chapter 11 petition (Bankr. D. S.C.
Case No. 13-02482) in Charleston, South Carolina on April 29,
2013. G. William McCarthy, Jr., Esq. and Daniel J. Reynolds, Jr.,
Esq., at McCarthy Law Firm, LLC, serve as counsel to the Debtor.
The Debtor operates the Hampton Lake Subdivision in Bluffton,
South Carolina. The Debtor disclosed $23.4 million in total
assets and $48.4 million in liabilities in its schedules.
HAMPTON LAKE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Hampton Lake, LLC
Post Office Box 21587
Hilton Head Island, SC 29925
Bankruptcy Case No.: 13-02482
Chapter 11 Petition Date: April 29, 2013
Court: United States Bankruptcy Court
District of South Carolina (Charleston)
Judge: John E. Waites
Debtor's Counsel: G. William McCarthy, Jr., Esq.
Daniel J. Reynolds, Jr., Esq.
MCCARTHY LAW FIRM, LLC
1517 Laurel Street (29201)
P.O. Box 11332
Columbia, SC 29211-1332
Tel: (803) 771-8836
Fax: (803) 753-6960
E-mail: bmccarthy@mccarthylawfirm.com
dreynolds@mccarthylawfirm.com
Scheduled Assets: $23,381,512
Scheduled Liabilities: $48,413,443
The petition was signed by Scott Middleton, CFO for Reed
Development Inc., Debtor's manager.
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Okatie Development CNH $808,672
Group LLC
c/o Thomas M.
Fitzpatrick
2305 Tufton Springs Lane
Reisterstown, MD 21136
Edward D Wood CNH $404,336
10 Tidelands Court
Bluffton, SC 29910
Joshua Tillman CNH $404,336
Caravel Properties LLC
2817 West End Avenue
Nashville, TN 37203
Stanley R Smith CNH $404,336
Smith Revocable Trust
26 Widewater Road
Hilton Head Island,
SC 29928
Albert M Serra CNH $404,336
Serra Trust
5644 N Rainbow Lane
Waterford, MI 48329
Thomas C Phillips CNH $404,336
88 Leamington Lane
Hilton Head Island,
SC 29928
F A Nimmer Jr CNH $404,336
47 Eleanor Avenue
Ridgeland, SC 29936
Jon N Morris CNH $404,336
10 Berkeley Court
Bluffton, SC 29910
Donald Mealey CNH $404,336
9216 Sloane Street
Orlando, FL 32827
Spain C. Kelley CNH $404,336
60 Bridgetown Road
Hilton Head Island,
SC 29928
Palmer S and Glendon CNH $404,336
M Jones
8 Tidelands Court
Bluffton, SC 29910
Frank Guidobono CNH $404,336
Guidobono LLC
19 Wexford Club Drive
Hilton Head Island,
SC 29938
Gary S Griffin CNH $404,336
9 Leamington Place
Hilton Head Island,
SC 29928
William C Green CNH $404,336
25 Outerbridge Circle
Hilton Head Island,
SC 29926
Mark D. Generales CNH $404,336
7 Salt Marsh Cove
Beaufort, SC 29907
Richard A and CNH $404,336
Denise Frame
155 Gleason Lake Road
Apt 206
Wayzata, MN 55391
Craig Simonson CNH $404,336
Dreamquest Holdings LLC
10 Waybridge Circle
Buffton, SC 29910
David and Mary L. CNH $404,336
Bianchi
245 Belfair Oak Blvd
Bluffton, SC 29910
Basis Point LLC CNH $404,336
269 Bamberg Drive
Bluffton, SC 29910
John C Albert CNH $404,336
8001 U.S. Highway 80
East Unit 804
Savannah, GA 31410
HAMPTON ROADS: Robin Gregory Joins as East Bank Manager
-------------------------------------------------------
Hampton Roads Bankshares, Inc., the holding company for The Bank
of Hampton Roads and Shore Bank, announced that Robin Witt Gregory
has joined BHR as Manager of the East Bank Financial Center in
Norfolk. Ms. Gregory brings over 20 years of banking experience
in the region.
Douglas J. Glenn, president and chief executive officer of the
Company and chief executive officer of BHR, said, "Our One Bank
strategy is all about having the best bankers and the right mix of
branches and online banking services to provide choice,
convenience and outstanding service to our customers. Robin is a
talented banker with a proven track record and longstanding
relationships in the Norfolk community, and we welcome her to the
team."
Donna W. Richards, president of BHR, said, "As a lifelong resident
of this area and experienced banker who was consistently
recognized for outstanding customer service at her former
employer, Robin is a great addition to our strong team in the
Norfolk market."
Prior to joining BHR, Ms. Gregory served as a Personal Banker at
SunTrust Bank in Norfolk since 2005. At SunTrust, she received a
Stellar Award for Service every year for the past seven years.
From 1996 to 2005, she served as a Customer Service Manager at
Bank of America in Norfolk. Previously, she served as a teller at
First Union National Bank in Norfolk.
Ms. Gregory attended Tidewater Community College. She is active
in a number of community organizations, including volunteering for
the Norfolk Public Schools and serving as a member of the
Lynnhaven River NOW Club and Save the Bay Foundation.
About Hampton Roads Bankshares
Hampton Roads Bankshares, Inc. (NASDAQ: HMPR) --
http://www.hamptonroadsbanksharesinc.com/-- is a bank holding
company that was formed in 2001 and is headquartered in Norfolk,
Virginia. The Company's primary subsidiaries are Bank of Hampton
Roads, which opened for business in 1987, and Shore Bank, which
opened in 1961. Currently, Bank of Hampton Roads operates twenty-
eight banking offices in the Hampton Roads region of southeastern
Virginia and twenty-four offices in Virginia and North Carolina
doing business as Gateway Bank & Trust Co. Shore Bank serves the
Eastern Shore of Maryland and Virginia through eight banking
offices and 15 ATMs.
Effective June 17, 2010, the Company and its banking subsidiary,
Bank of Hampton Roads ("BOHR"), entered into a written agreement
with the Federal Reserve Bank of Richmond and the Bureau of
Financial Institutions of the Virginia State Corporation
Commission. The Company's other banking subsidiary, Shore Bank,
is not a party to the Written Agreement.
Under the terms of the Written Agreement, among other things, BOHR
agreed to develop and submit for approval plans to (a) strengthen
board oversight of management and BOHR's operations, (b)
strengthen credit risk management policies, (c) improve BOHR's
position with respect to loans, relationships, or other assets in
excess of $2.5 million which are now, or may in the future become,
past due more than 90 days, are on BOHR's problem loan list, or
adversely classified in any report of examination of BOHR, (d)
review and revise, as appropriate, current policy and maintain
sound processes for determining, documenting, and recording an
adequate allowance for loan and lease losses, (e) improve
management of BOHR's liquidity position and funds management
policies, (f) provide contingency planning that accounts for
adverse scenarios and identifies and quantifies available sources
of liquidity for each scenario, (g) reduce the Bank's reliance on
brokered deposits, and (h) improve BOHR's earnings and overall
condition.
The Company reported a net loss of $98 million in 2011, compared
with a net loss of $210.35 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$2.07 billion in total assets, $1.88 billion in total liabilities
and $187.96 million in total shareholders' equity.
HARRISBURG, PA: SEC Charges for Fraudulent Public Statements
------------------------------------------------------------
The Securities and Exchange Commission on May 6 charged the City
of Harrisburg, Pa., with securities fraud for its misleading
public statements when its financial condition was deteriorating
and financial information available to municipal bond investors
was either incomplete or outdated.
An SEC investigation found that the misleading statements were
made in the city's budget report, annual and mid-year financial
statements, and a State of the City address. This marks the first
time that the SEC has charged a municipality for misleading
statements made outside of its securities disclosure documents.
Harrisburg has agreed to settle the charges.
The SEC found that Harrisburg failed to comply with requirements
to provide certain ongoing financial information and audited
financial statements for the benefit of investors holding hundreds
of millions of dollars in bonds issued or guaranteed by the city.
As a result of Harrisburg's non-compliance from 2009 to 2011,
investors had to seek out Harrisburg's other public statements in
order to obtain current information about the city's finances.
However, very little information about the city's fiscal situation
was publicly available elsewhere. Information that was accessible
on the city's website such as its 2009 budget, 2009 State of the
City address, and 2009 mid-year fiscal report either misstated or
failed to disclose critical information about Harrisburg's
financial condition and credit ratings.
The SEC separately issued a report May 6 addressing the disclosure
obligations of public officials and their potential liability
under the federal securities laws for public statements made in
the secondary market for municipal securities.
"In an information vacuum caused by Harrisburg's failure to
provide accurate information about its deteriorating financial
condition, municipal investors had to rely on other public
statements misrepresenting city finances," said George S.
Canellos, Co-Director of the SEC's Division of Enforcement.
"Statements that are reasonably expected to reach the securities
markets, even if not prepared for that purpose, cannot be
materially misleading."
Elaine C. Greenberg, Chief of the SEC's Enforcement Division's
Municipal Securities and Public Pensions Unit, said, "A municipal
issuer's obligation to provide accurate and timely material
information to investors is an ongoing one. Because of
Harrisburg's misrepresentations, secondary market investors made
trading decisions based on inaccurate and stale information."
According to the SEC's order instituting settled administrative
proceedings, Harrisburg is a near-bankrupt city under state
receivership largely due to approximately $260 million in debt the
city had guaranteed for upgrades and repairs to a municipal
resource recovery facility owned by The Harrisburg Authority. As
of March 15, 2013, Harrisburg has missed approximately $13.9
million in general obligation debt service payments.
According to the SEC's order, Harrisburg had not submitted annual
financial information or audited financial statements since
submitting its 2007 Comprehensive Annual Financial Report (CAFR)
to a Nationally Recognized Municipal Securities Information
Repository (NRMSIR) in January 2009. Beginning in July 2009,
Harrisburg was obligated to submit financial information and
notices such as principal and interest payment delinquencies and
changes in bond ratings to a central repository known as the
Electronic Municipal Market Access (EMMA) system maintained by the
Municipal Securities Rulemaking Board (MSRB). Harrisburg did not
submit its 2008 CAFR to EMMA, instead erroneously submitting it to
a former NRMSIR on March 2, 2010. Harrisburg did not submit its
2009 CAFR to EMMA until Aug. 6, 2012, and did not submit its 2010
CAFR to EMMA until Dec. 20, 2012. The city did not submit material
event notices about its failure to submit annual financial
information or its credit rating downgrades until March 29, 2011,
after the SEC had commenced its investigation.
Therefore, the SEC's order finds that at a time of increased
interest in the Harrisburg's financial health due to the
deteriorating financial condition of The Harrisburg Authority, the
city created a risk that investors could purchase or sell
securities in the secondary market on the basis of incomplete and
outdated information. For current information, investors had to
review other public statements from the city about its fiscal
situation. For example, Harrisburg's 2009 budget and its
accompanying transmittal letter were accessible on Harrisburg's
website. By the time the 2009 budget was passed, Harrisburg was
aware of the Authority's projected budget deficits and that
Dauphin County was challenging a rate increase. As a result, the
Authority was unlikely to have sufficient revenues to pay its 2009
debt service obligations. However, Harrisburg's 2009 budget as
adopted did not include funds for debt guarantee payments. The
2009 budget also misstated Harrisburg's credit as being rated
"Aaa" by Moody's when in fact Moody's had downgraded Harrisburg's
general obligation credit rating to Baa1 by December 2008.
According to the SEC's order, another public statement available
to investors on the city's website was the annual State of the
City address delivered on April 9, 2009. The address only
discussed the municipal resource recovery facility as a situation
that was an "additional challenge" and an "issue that can be
resolved." The address was misleading because it failed to mention
that by this time, Harrisburg had already made $1.8 million in
guarantee payments on the resource recovery facility bond debt. It
also omitted the total amount of the debt that the city would
likely have to repay from its general fund. By this time,
Harrisburg knew that the Authority had failed to secure the
requested rate increase, making it likely that Harrisburg would
have to repay $260 million of the debt as guarantor.
According to the SEC's order, Harrisburg's 2009 mid-year fiscal
report available on its website was designed to provide a snapshot
of budget-to-actual figures at the middle of the year. However,
the report did not reference any of the guarantee payments the
city had made on the municipal resource recovery facility debt,
which at this mid-year point totaled $2.3 million (7 percent of
its general fund expenditures).
The SEC's order requires Harrisburg to cease and desist from
committing or causing violations of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5. The city neither
admits nor denies the findings in the order. In the settlement,
the SEC considered Harrisburg's cooperation in the investigation
and the various remedial measures implemented by the city to
prevent further securities laws violations.
The SEC's investigation was conducted by members of the
Enforcement Division's Municipal Securities and Public Pensions
Unit including Senior Enforcement Counsel Yolanda Gonzalez and
Assistant Director Ivonia K. Slade with assistance from Municipal
Securities Specialist Jonathan D. Wilcox. The investigation was
supervised by Unit Chief Elaine C. Greenberg and Deputy Chief Mark
R. Zehner.
* * *
In its Report of Investigation to address the secondary market
disclosure responsibilities of public officials when they make
public statements about a municipal issuer, the SEC notes that
public officials should be mindful that their written or oral
public statements may affect the total mix of information
available to investors. This could result in anti-fraud liability
under the federal securities laws for the public officials making
such statements if they are materially misleading or omit material
information.
The report further states that public officials should consider
taking steps to reduce the risk of misleading investors. At a
minimum, they should consider adopting policies and procedures
that are reasonably designed to result in accurate, timely, and
complete public disclosures; identifying those persons involved in
the disclosure process; evaluating other public disclosures
including financial information made by the municipal issuer; and
assuring that responsible individuals receive adequate training
about their obligations under the federal securities laws.
HARVEST NATURAL: PwC LLP Raises Going Concern Doubt
---------------------------------------------------
Harvest Natural Resources, Inc., filed on May 2, 2013, its annual
report on Form 10-K for the year ended Dec. 31, 2012.
PricewaterhouseCoopers LLP, in Houston, Texas., expressed
substantial doubt about Harvest Natural's ability to continue as a
going concern. The independent auditors noted that the Company
has not generated revenue and has incurred recurring losses and
negative cash flows from operations that raise substantial doubt
about its ability to continue as a going concern.
The Company reported net income of $12,211 in 2012, compared to
net income of $70,137 in 2011. For the year ended Dec. 31, 2012,
the Company had no revenues from continuing operations and net
cash used in operating activities of $26.4 million. For the year
ended Dec. 31, 2011, the Company had no revenues from continuing
operations and net cash used in operating activities of
$55.2 million.
Harvest Natural said: "The Company had a net loss attributable to
Harvest of $12.2 million for the year ended Dec. 31, 2012,
compared to net income attributable to Harvest of $56.0 million
for the year ended Dec. 31, 2011. Net loss attributable to
Harvest for the year ended Dec. 31, 2012, includes $9.1 million of
exploration expense, $9.3 of impairment expense, $5.6 million of
dry hole costs and net equity income from Petrodelta's operations
of $67.8 million. Net income attributable to Harvest for the year
ended Dec. 31, 2011, includes $12.6 million of exploration
expense, $3.3 million of impairment expense, $49.7 million of dry
hole costs and net equity income from Petrodelta's operations of
$73.5 million.
Restatement of Prior Period Financial Statements
"In connection with the preparation of our Annual Report on Form
10-K for the year ended Dec. 31, 2012, we concluded that there
were errors in previously filed financial statements. In the
course of our review, management determined that (a) certain
warrants issued in 2010 in connection with our $60 million term
loan facility were improperly valued at inception and improperly
classified as equity instruments rather than liability
onstruments. As a result of the improper classification of the
Warrants, (b) the debt discount and associated interest expense
related to the amortization of the debt discount was understated
for all periods in which the associated debt was outstanding, and
(c) the consolidated statement of operations and comprehensive
income (loss) for each reporting period was misstated by the
omission of the changes in fair value of the Warrants as a
liability instrument. Additionally, (d) certain exploration
overhead was incorrectly capitalized to oil and gas properties,
which under the successful efforts method of accounting should
have been expensed, and (e) certain leasehold maintenance and
other costs were improperly capitalized to oil and gas properties,
which under the successful efforts method of accounting should
have been expensed. Finally, (f) advances to equity affiliate
were improperly classified as an operating activity rather than an
investing activity and (g) certain costs were improperly
classified as an investing activity rather than an operating
activity on the consolidated statement of cash flows. Such errors
impacted annual periods ended Dec. 31, 2010, and 2011, and
quarterly periods ended March 31, 2011, June 30, 2011, Sept. 30,
2011, Dec. 31, 2011, March 31, 2012, June 30, 2012, and
Sept. 30, 2012.
"As a result of the errors related to the Warrants described
above, loss on extinguishment of debt was understated for the year
ended Dec. 31, 2011, and the quarters ended June 30, 2011,
Sept. 30, 2011, and Dec. 31, 2011.
"Additionally, an error was identified in the calculation of
earnings (loss) per diluted share for the year ended Dec. 31,
2011, and the three and six months ended June 30, 2011, and an
additional error was identified related to the improper expensing
of costs associated with debt conversions that should have been
recorded to equity for the quarters ended March 31, 2012, and
Sept. 30, 2012.
"We have restated our segment footnote information to reflect the
applicable errors stated above and (a) reclassify noncontrolling
interest from United States segment to Venezuela segment, (b)
eliminate intrasegment receivables erroneously reported gross of
related intrasegment payable, and (c) eliminate intrasegment
revenue erroneously reported gross of related intrasegment
expense. Such errors impacted annual periods ended Dec. 31, 2010,
and 2011, and quarterly periods ended March 31, 2011, June 30,
2011, Sept. 30, 2011, Dec. 31, 2011, March 31, 2012, June 30,
2012, and Sept. 30, 2012. We also restated our financial
statement schedule to reflect adjustments to the balance sheet
related to income taxes for the years ended Dec. 31, 2010, and
2011.
"In assessing the severity of the errors, management determined
that the errors were material to the consolidated financial
statements for the years ended Dec. 31, 2011, and 2010, and
quarterly information for all quarters in 2011 and the first,
second and third quarters of 2012. In addition to the errors
described above, we made corrections for previously identified
immaterial errors and errors affecting classification within the
consolidated statement of operations and comprehensive income
(loss) related to impairment of oil and gas properties and income
taxes and the consolidated balance sheets related to income taxes.
Balance Sheet
The Company's balance sheet at Dec. 31, 2012, showed
$596.8 million in total assets, $120.4 million in total
liabilities, and stockholders' equity of $476.4 million.
A copy of the Form 10-K is available at http://is.gd/OsBBrb
About Harvest Natural
Harvest Natural Resources, Inc. (NYSE: HNR) is a petroleum
exploration and production company incorporated under Delaware law
in 1989. The Company's focus is on acquiring exploration,
development and producing properties in geological basins with
proven active hydrocarbon systems. HNR operates from its Houston,
Texas headquarters. HNR also has regional/technical offices in
the United Kingdom and Singapore, and field offices in Jakarta,
Republic of Indonesia; Port Gentil, Republic of Gabon; and Muscat,
Sultanate of Oman to support field operations in those areas.
The Company has acquired and developed significant interests in
the Bolivarian Republic of Venezuela. Its Venezuelan interests
are owned through Harvest-Vinccler Dutch Holding, B.V., a Dutch
private company with limited liability ("Harvest Holding"). HNR's
ownership of Harvest Holding is through HNR Energia, B.V., in
which HNR has a direct controlling interest. Through HNR Energia,
HNR indirectly owns 80 percent of Harvest Holding and the
Company's partner, Oil & Gas Technology Consultants (Netherlands)
Cooperatie U.A., a controlled affiliate of Venezolana de
Inversiones y Construcciones Clerico, C.A. ("Vinccler"),
indirectly owns the remaining 20 percent interest of Harvest
Holding. Harvest Holding owns, indirectly through wholly owned
subsidiaries, a 40 percent of Petrodelta, S.A. As HNR indirectly
owns 80 percent of Harvest Holding, it indirectly owns a net 32
percent interest in Petrodelta, and Vinccler indirectly owns eight
percent. Corporacion Venezolana del Petroleo S.A. ("CVP") owns
the remaining 60 percent of Petrodelta. Petroleos de Venezuela
S.A. ("PDVSA") owns 100 percent of CVP. Harvest Holding has a
direct controlling interest in Harvest Vinccler S.C.A. Harvest
Vinccler's main business purposes are to assist HNR in the
management of Petrodelta and in negotiations with PDVSA. HNR does
not have a business relationship with Vinccler outside of
Venezuela.
In addition to its interests in Venezuela, HNR hold exploration
acreage mainly onshore West Sulawesi in Indonesia, offshore of
Gabon, onshore in Oman, and offshore of the People's Republic of
China.
For the year ended December 31, 2012, we had no revenues from
continuing operations and net cash used in operating activities of
$26.4 million. As of December 31, 2011, we had total assets of
$507.2 million, unrestricted cash of $58.9 million and long-term
debt of $31.5 million. For the year ended December 31, 2011, we
had no revenues from continuing operations and net cash used in
operating activities of $55.2 million.
HAWAII OUTDOOR: May 20 Hearing on Cash Use, Case Trustee
--------------------------------------------------------
A hearing on the request of Hawaii Outdoor Tours, Inc., for
continued use of cash collateral is set for May 20, 2013.
First Citizens Bank's motion for appointment of a case trustee is
reinstated for hearing also to be held May 20.
The bank's supplemental brief is due May 6, the response brief is
due May 13, and the reply brief is due May 16.
About Hawaii Outdoor Tours
Hawaii Outdoor Tours, Inc., operator of the Niloa Volcanoes
Resort in Hilo, Hawaii, filed a Chapter 11 petition (Bankr. D.
Haw. Case No. 12-02279) in Honolulu on Nov. 20, 2012. Niloa
Volcanoes is a 382-room hotel with a nine-hole golf course. The
64-acre property is subject to a 65-year lease, commencing Feb. 1,
2006, and provides for a total ground rent for the first 10 years
of $500,000 annually. The Debtor used a $10 million loan from
First Regional Bank and $10 million of its own cash to invest in
the property.
First-Citizens Bank & Trust Company, which acquired the First
Regional note from the Federal Deposit Insurance Corp., commenced
foreclosure proceedings in August. First-Citizens Bank asserts a
claim of $9.95 million. The Debtor believes that the value of the
hotel property exceeds the amount of the First-Citizens Bank note.
Just the bricks and mortal alone was valued in excess of $35
million by First Regional's appraiser and the insurance company.
Bankruptcy Judge Robert J. Faris oversees the case. Wagner Choi &
Verbrugge acts as bankruptcy counsel.
In its schedules, the Debtor disclosed $52,492,891 in assets and
$11,756,697 in liabilities. The petition was signed by CEO
Kenneth Fujiyama.
Ted N. Petitt, Esq., represents Secured Creditor First-Citizens
Bank as counsel. Cynthia M. Johiro, Esq., represents the State of
Hawaii Department of Taxation as counsel.
J.M. TENDALL: Case Summary & 4 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: J.M. Tendall, Inc.
541 Ranger Lane
Longboat Key, FL 34228
Bankruptcy Case No.: 13-05830
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Middle District of Florida (Tampa)
Judge: Catherine Peek McEwen
Debtor's Counsel: Benjamin G. Martin, Esq.
LAW OFFICES OF BENJAMIN MARTIN
1620 Main Street, Suite 1
Sarasota, FL 34236
Tel: (941) 951-6166
Fax: (941) 951-2076
E-mail: skipmartin@verizon.net
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 unsecured creditors is
available for free at http://bankrupt.com/misc/flmb13-05830.pdf
The petition was signed by John M. Tendall, president.
JENROB PROPERTIES: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Jenrob Properties LLC
16275 Collins Avenue 1701
Sunny Isles Beach, FL 33160
Bankruptcy Case No.: 13-20326
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Southern District of Florida (Miami)
Judge: A. Jay Cristol
Debtor's Counsel: Joel M. Aresty, Esq.
JOEL M. ARESTY, P.A.
13499 Biscayne Boulevard, #T-3
No. Miami, FL 33181
Tel: (305) 899-9876
Fax: (305) 723-7893
E-mail: aresty@mac.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 Vani Lalwani.
K-V PHARMACEUTICAL: Will Pursue Investors' Alternative Ch. 11 Plan
------------------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that K-V
Pharmaceutical Co. on Friday indicated that it is ready to ditch
its proposed Chapter 11 plan for an alternative plan offered by a
group of investors that could provide general unsecured creditors
five times as much recovery as the current plan would.
According to the report, the women's health care company laid out
the terms of the newly proposed plan in a motion asking a New York
bankruptcy court to approve a new debtor-in-possession financing
package that is necessary for K-V to go through with its pursuit
of the reorganization plan.
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.
KINGSBURY CORP: Files Liquidating Plan, To Sell Real Estate
-----------------------------------------------------------
KMTC, f/k/a Kingsbury Corporation, Donson Group, Ltd., and Ventura
Industries, LLC, propose a liquidating plan, provides for:
(1) the sale of Kingsbury's real estate located at 80 Laurel
Street, Keene, New Hampshire either through a foreclosure
sale conducted by TD Bank, N.A. or through a Court-approved
sale under Section 363 of the United States Bankruptcy
Code;
(2) the distribution of proceeds resulting from the sale of the
Real Estate to Kingsbury's secured creditors, the City of
Keene, New Hampshire, TD Bank, the U.S. Small Business
Administration, and Diamond Business Credit, LLC;
(3) the transfer of residual assets and postconfirmation causes
of action -- including litigation currently pending before
the Court against Optimation Technology, Inc., PPL Group,
LLC, and Utica Leaseco, LLC -- into a liquidating trust;
and
(4) distributions to creditors holding administrative, priority
and unsecured claims in accordance with the provisions of
the liquidating trust agreement.
Secured claims will be paid in full from the sale proceeds, or
holders of secured claims will retain their liens in the real
estate and their allowed secured claims will be satisfied from the
real estate proceeds. General unsecured claims will be paid in
full, while interests will be cancelled and holders of interests
will take nothing under the Plan.
A full-text copy of the Disclosure Statement dated April 22, 2013,
is available for free at:
http://bankrupt.com/misc/KINGSBURYCORPds0422.pdf
About Kingsbury Corp.
Kingsbury Corp. -- http://www.kingsburycorp.com/-- makes and
assembles machine systems. Kingsbury and affiliate Ventura
Industries, LLC, filed Chapter 11 petition (Bankr. D. N.H. Case
Nos. 11-13671 and 11-13687) on Sept. 30, 2011. Jennifer Rood,
Esq., and Robert J. Keach, Esq., at Berstein, Shur, Sawyer &
Nelson, serve as counsel to the Debtors. Donnelly Penman &
Partners serves as its investment banker. In its schedules, the
Debtor disclosed $10,134,679 in assets, and $24,534,973 in
liabilities as of the petition date.
William K. Harrington, the U.S. Trustee for Region 1, appointed
five members to serve on the Official Committee of Unsecured
Creditors.
KREISS ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Kreiss Enterprises, Inc.
dba Kreiss
dba Kreiss Collection
8619 Melrose Ave
West Hollywood, CA 90069
Bankruptcy Case No.: 13-21466
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Judge: Neil W. Bason
Debtor's Counsel: Martin J. Brill, Esq.
LEVENE, NEALE, BENDER, YOO & BRILL LLP
10250 Constellation Blvd Ste 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Fax: (310) 229-1244
E-mail: mjb@lnbrb.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 together with the petition, is available for free
at http://bankrupt.com/misc/cacb13-21466.pdf
The petition was signed by Thomas J. Kreiss, chief executive
officer.
LEASEMOBILE OF SONORA: Voluntary Chapter 11 Case Summary
--------------------------------------------------------
Debtor: Leasemobile of Sonora, Inc.
14890 Mono Way
Sonora, CA 95370
Bankruptcy Case No.: 13-90819
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Eastern District of California (Modesto)
Judge: Ronald H. Sargis
Debtor's Counsel: David C. Johnston, Esq.
1600 G Street, Suite 102
Modesto, CA 95354
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
LIFECARE HOLDINGS: Revolving Loan Agreement Approval Sought
-----------------------------------------------------------
BankruptcyData reported that LifeCare Holdings filed with the U.S.
Bankruptcy Court a motion to enter into a revolver engagement
letter with GE Capital Markets and Hospital Acquisition in
connection with the Hospital Acquisition Sub I $30 million senior
secured first lien revolving facility and a revolver engagement
letter with Credit Suisse Securities in connection with the
Hospital Acquisition Sub I $200 million senior secured first lien
term facility.
The Court scheduled a May 22, 2013 hearing on the motion.
About LifeCare
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, to sell the 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.
LEHMAN BROTHERS: Sues to Slash Syncora's $1.3B Mortgage Note Claim
------------------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that Lehman Brothers
Holdings Inc. on Thursday sued Syncora Guarantee Inc. in New York
bankruptcy court, aiming to slash the bond insurer's $1.3 billion
claim alleging the fallen investment giant misled it about the
quality of mortgage-backed notes it insured.
According to the report, in an adversary proceeding launched in
Manhattan, Lehman urged a judge to cut a substantial part of
Syncora's claim based on allegations that Lehman was dishonest
about the quality of certain notes backed by mortgages when it
brought Syncora on to insure them.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates.
LKS CONCEPTS: Case Summary & 8 Unsecured Creditors
--------------------------------------------------
Debtor: LKS Concepts
dba Dylan Prime
62 Laight Street
New York, NY 10013
Bankruptcy Case No.: 13-11390
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge: James M. Peck
Debtor's Counsel: Gerard R. Luckman, Esq.
SILVERMANACAMPORA, LLP
100 Jericho Quadrangle, Suite 300
Jericho, NY 11753
Tel: (516) 479-6300
Fax: (516) 479-6301
E-mail: filings@spallp.com
Scheduled Assets: $64,220
Scheduled Liabilities: $2,167,947
A copy of the Company's list of its eight largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/nysb13-11390.pdf
The petition was signed by John Mautone, managing member.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
363 Greenwich, LLC 08-14247 10/29/08
MASTRO'S RESTAURANT: S&P Lowers Corp. Credit Rating to 'SD'
-----------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Woodland Hills, Calif.-based Mastro's Restaurants
LLC to 'SD' from 'B-'. At the same time, S&P affirmed its 'B-'
issue-level rating on the company's $102 million senior secured
notes due 2017. The '4' recovery rating remains unchanged. S&P
removed all ratings from CreditWatch, where it placed them with
negative implications on April 25, 2013.
"The rating action follows Mastro's conversion of approximately
$42 million in seller notes to equity of the company," said credit
analyst Mariola Borysiak. "In its financial filing for fiscal
2012 the company disclosed that it agreed with former owner and
holder of the seller note to finalize and execute a settlement
agreement pertaining to the lawsuit in which both parties were
engaged since 2011. The lawsuit was settled on April 26, 2013.
We understand that according to the settlement agreement, the
holders of the notes obtained a portion of equity ownership (both
preferred and common) in the company."
S&P's 'B-' issue-level and '4' recovery ratings on Mastro's
$102 million senior secured notes remain unchanged. S&P expects
to raise its corporate credit rating on Mastro's to 'B-' with a
stable outlook in the next couple of days - a rating that
reflects, in S&P's opinion, a "highly leveraged" financial profile
and a "vulnerable" business risk profile. S&P will also likely
view Mastro's liquidity as "adequate" following conversion of the
notes.
MAXCOM TELECOMUNICACIONES: May File for Bankruptcy by June 15
-------------------------------------------------------------
Maxcom Telecomunicaciones, S.A.B. de C.V., on Dec. 4, 2012,
entered into a recapitalization agreement pursuant to which it
would conduct an exchange offer for its outstanding senior secured
notes and concurrently Ventura Capital Privado S.A. de C.V. would
conduct a tender offer for Maxcom's outstanding equity securities
and make a capital contribution into Maxcom. The Tender Offer and
Capital Contribution were conditioned on, among other things, the
success of the Debt Exchange Offer. The Debt Exchange Offer was
extended three times and expired on April 24, 2013, without the
conditions to the offer having been satisfied and, as a result,
Maxcom did not receive the Capital Contribution. Maxcom's
operational and financial position has further deteriorated by
virtue of not having received the Capital Contribution and without
additional sources of capital, the Company may not be able to make
the coupon payment due on June 15, 2013, with respect to the
Company's outstanding senior secured notes and the Company may not
be able to meet other financial obligations as they come due. If
this occurs, holders of Maxcom's outstanding senior secured notes
and the Company's other creditors could commence involuntary
bankruptcy proceedings against the Company in Mexico or in the
United States. In addition, the Company's business is very
capital intensive and there is a significant risk that the Company
will not have the ability to make the necessary investments in
technology, infrastructure and maintenance of the Company's
network.
In light of the outcome of the Debt Exchange Offer, Maxcom is
considering its alternatives including, but not limited to, the
commencement of a voluntary restructuring under Chapter 11 of the
United States Bankruptcy Code or other restructuring proceeding as
the Company may not be able to satisfy its liquidity and working
capital requirements or restructure its capital structure. The
Company is currently assembling a plan intended to achieve that
restructuring, which includes the Company's assessment of the
implications that such plan will have, if any, on the Company's
financial position, results of operations, cash flows and related
disclosures. Based on this analysis, Maxcom may conclude it will
not be able to continue as a going concern and the Company's
independent registered public accounting firm may or may not
concur with that conclusion upon their completing their audit.
This situation has caused the Company to delay the issuance of its
consolidated financial statements as of and for the year ended
Dec. 31, 2012, intended to be included in the Company's annual
report for the year ended Dec. 31, 2012, on Form 20-F and
consequently not permitting the Company's independent registered
public accounting firm to complete their audit and report on those
consolidated financial statements.
The Company anticipates, based on the information currently
available to it, that its results of operations for the year ended
Dec. 31, 2012, will be significantly different then the results of
operations for the year ended Dec. 31, 2011.
The Company expects to report Ps.2,201.3 million in net revenues
for the year ended Dec. 31, 2012. The Company expects to report
an operating loss of Ps.64.2 million for the year ended Dec. 31,
2012, primarily as a result of lower contribution margins. The
Company expects to report net loss of Ps.136.1 million for the
year ended Dec. 31, 2012, which reflects operating loss, as well
as interest expense.
About Maxcom
Maxcom Telecomunicaciones, S.A.B. de C.V., headquartered in Mexico
City, Mexico, is a facilities-based telecommunications provider
using a "smart-build" approach to deliver last-mile connectivity
to micro, small and medium-sized businesses and residential
customers in the Mexican territory. Maxcom launched commercial
operations in May 1999 and is currently offering local, long
distance, data, value-added, paid TV and IP-based services on a
full basis in greater metropolitan Mexico City, Puebla, Tehuacan,
San Luis, and Queretaro, and on a selected basis in several cities
in Mexico.
* * *
Maxcom carries a 'CC' corporate credit rating from Standard &
Poor's Ratings Services and a "Caa1" from Moody's Investors
Service.
MERUELO MADDUX: Rejection of Belinda Meruelo Claim Affirmed
-----------------------------------------------------------
Belinda Meruelo, individually, as trustee of the Meruelo Living
Trust u/d/t dated November 11, 1988, and as representative of the
Estate of Homer Meruelo, filed a proof of claim in the chapter 11
bankruptcy case of Merco Group 2001-2021 West Mission Boulevard,
LLC, a debtor affiliate of Meruelo Maddux Properties Inc. Merco
Group objected to the claim and moved for disallowance; the
bankruptcy court granted the disallowance motion. Belinda appeals
the bankruptcy court's order disallowing the claim.
In a ruling last month, the U.S. Bankruptcy Appellate Panel for
the Ninth Circuit affirmed.
In early 2005, Merco Group, as buyer, entered into a contract with
Meruelo Pomona, LLC, as seller, to purchase improved real property
located in Pomona, California, for $20,000,000. Belinda and her
late husband, Homer Meruelo, managed and owned the selling entity.
Their son, Richard Meruelo, managed Merco Group.
When Seller and Merco Group executed the purchase agreement, a
deed of trust securing debt owed by Seller to PNL Pomona, L.P.
encumbered the Property. PNL also held a written guaranty from
Belinda guaranteeing repayment of its loan to Seller.
The sale transaction closed over two years later on July 27, 2007.
On closing, Merco Group paid the sales price, in part, by assuming
the obligation to repay the PNL loan which had a then outstanding
balance of $8,763,304.85. The Purchase Agreement did not require a
release of the Guaranty, and Belinda remained bound by the
Guaranty after assumption.
Merco Group and 53 related entities filed voluntary chapter 11
petitions in March 2009. The Property became an asset of a
bankruptcy estate. On September 24, 2009, Belinda filed the
original proof of claim, which stated that it was an
indemnification claim and sought payment to the extent Belinda, in
the future, incurred losses associated with Merco Group's failure
to re-pay PNL.
Thereafter, PNL sued Belinda in an action seeking recovery on the
Guaranty in Los Angeles Superior Court, PNL Pomona, L.P. v.
Belinda Meruelo, et al., case number KC055493. As a result, on
December 6, 2011, Belinda filed an amendment to the Original Claim
and asserted a specific claim for $3,306,941.05 based on a
proposed judgment dated October 20, 2011 in the Guaranty Action.
In the Amended Claim, Belinda alleged that: (1) as a third party
beneficiary to the Purchase Agreement, she may enforce the
Purchase Agreement against Merco Group pursuant to California
Civil Code section 1559 ("CC Section 1559"); and (2) she holds
rights to reimbursement and indemnification under California law,
including California Civil Code section 2847 ("CC Section 2847").
On January 23, 2012, Merco Group sought disallowance of Belinda's
claim. First, Merco Group argued that section 502(e) of the
Bankruptcy Code bars recovery under the Amended Claim as Belinda
had not yet paid the PNL judgment. Second, Merco Group asserted
that section 580d of the California Code of Civil Procedure ("CCP
Section 580d") barred recovery. Merco Group, citing Union Bank v.
Gradsky, 265 Cal.App.2d 40, 44-47 (1968), argued that just as this
anti-deficiency statute protects a borrower from a lender's
deficiency claim after a non-judicial foreclosure, it also
protects a borrower from the guarantor's reimbursement claim.
Belinda filed an opposition, arguing that Merco Group's first
basis for disallowance, section 502(e), did not apply, because
Merco Group was not liable with Belinda on the Guaranty. Belinda
noted that the confirmed plan allowed PNL to non-judicially
foreclose, that this foreclosure eradicated PNL's deficiency
rights against Merco Group by operation of California law, and
that this left only Belinda liable to PNL.
The Opposition did not address Merco Group's second basis for
disallowance, CCP Section 580d. Instead, Belinda argued that Merco
Group breached the Purchase Agreement when, having agreed to
assume the PNL debt, it failed to satisfy the PNL debt in full and
thereby release Belinda from obligations under the Guaranty.
Belinda alleged that Seller contracted with Merco Group for the
"express purpose of relieving [Belinda's] mortgage debt through
the assumption of the loan by [Merco Group]." Belinda asserted,
therefore, that as the third party beneficiary of the Purchase
Agreement, she had the right to compel Merco Group to perform its
obligations under the Purchase Agreement. Belinda, thus, requested
that the bankruptcy court infer that such contractual obligations
included payment of all the alleged damages incurred, or to be
incurred, as a result of the Guaranty Action and Merco Group's
failure to pay PNL in full.
The bankruptcy court heard oral argument on the Motion and
Opposition on May 11, 2012. After hearing brief argument, the
bankruptcy court granted the Motion, saying it doesn't see Belinda
as a third-party beneficiary. The court said, "They bought the
property. The intention wasn't to relieve her of the debt, it was
to acquire the property. And so the Court's going to -- and for
the other grounds explained in the motion. So the objection is
sustained."
Belinda filed a timely notice of appeal.
According to the Ninth Circuit BAP, the bankruptcy court did not
err when it disallowed Belinda's Amended Claim.
The appellate case is, BELINDA MERUELO, Appellant, v. MERUELO
MADDUX PROPERTIES, INC., et al., Appellees, BAP No. CC-12-1303-
TaMoMk (9th Cir. BAP). A copy of the BAP's April 9, 2013
memorandum is available at http://is.gd/vO3Azrfrom Leagle.com.
About Meruelo Maddux
Meruelo Maddux Properties, Inc., and its affiliates filed for
Chapter 11 protection (Bankr. C.D. Cal. Lead Case No. 09-13356) on
March 26, 2009. John N. Tedford, IV, Esq., and Enid M. Colson,
Esq., at Danning Gill, Diamond & Kollitz, LLP, in Los Angeles,
represent the Debtors in their restructuring effort. The Debtors'
financial condition as of Dec. 31, 2008, showed $681,769,000 in
assets and $342,022,000 of debts.
FTI Consulting, Inc., serves as the Debtors' financial advisors,
Ernst & Young as independent auditors and tax advisors, DLA Piper
LLP (US) as special securities and litigation counsel, and Waldron
& Associates, Inc. as real estate appraiser.
The U.S. Trustee appointed an official committee of unsecured
creditors and a separate official shareholders' committee in the
case. SulmeyerKupetz, APC, serves as the Creditors Committee's
counsel and Kibel Green, Inc., as its financial advisor. The
equity committee has sought to retain Ron Orr & Professionals,
Inc., Rodiger Law Office, and Jenner & Block as counsel, and Kibel
Green, Inc. as its financial advisor. The Debtors have hired
Kurtzman Carson Consultants as solicitation and balloting agent.
The Debtors; Legendary Investors Group No. 1, LLC, and East West
Bank; and Charlestown Capital Advisors, LLC and Hartland Asset
Management Corporation have proposed rival reorganization plans in
the case. In mid-January 2011, the Debtors struck a deal with the
Legendary Group to drop the group's competing plan.
Legendary Investors Group No. 1, LLC, is represented in the case
by Jeremy V. Richards, Esq., and Jeffrey W. Dulberg, Esq., at
Pachulski Stang Ziehl & Jones LLP; and Surjit P. Soni, Esq., at
The Soni Law Firm. East West Bank is represented by Curtis C.
Jung, Esq., and Monica H. Lin, Esq., at Jung & Yuen, LLP, and
Elmer Dean Martin III, Esq.
Charlestown Capital Advisors, LLC and Hartland Asset Management
Corporation are represented in the case by Christopher E. Prince,
Esq., Matthew A. Lesnick, Esq., and Andrew R. Cahill, Esq., at
Lesnick Prince LLP.
On June 24, 2011, after trial on competing proposed plans, the
bankruptcy court entered an order confirming the plan of
reorganization proposed by two of MMPI's minority shareholders.
That plan -- by Charlestown Capital Advisors, LLC's and Hartland
Asset Management Corporation -- became effective July 26, 2011.
Under the Plan, Charlestown Capital obtained control of the
reorganized company. The Charlestown Plan provided for payment in
full to holders of undisputed unsecured claims on the Effective
Date and for payment to holders of secured claims either by
surrender of collateral or through payment over a four-year
period.
MERUELO MADDUX: Former Exec Clears Hurdle to Seek Defense Costs
---------------------------------------------------------------
EVOQ Properties, Inc., formerly known as Meruelo Maddux
Properties, Inc., and the reorganized debtor in the jointly
administered chapter 11 cases, appeals from a bankruptcy court
order allowing John Charles Maddux to pursue enforcement of the
advancement provisions of a pre-petition indemnity agreement in a
non-bankruptcy forum. John seeks advancement of defense costs in
connection with post-confirmation litigation based on allegations
of his pre- and post-petition wrongful conduct as an officer and
director of MMPI. In an April 15 Memorandum, a three-judge panel
of the United States Bankruptcy Appellate Panel for the Ninth
Circuit affirmed.
The Reorganized Debtor sued John and others in California Superior
Court. The Reorganized Debtor has argued that if it establishes
(apparently in the State Court Action) that John acted
inequitably, then the Reorganized Debtor should be allowed to
request that the bankruptcy court equitably subordinate his
claims.
The BAP, however, held that pursuant to the confirmed Charlestown
Plan, "undisputed unsecured creditors were paid in full on the
Effective Date. Subordination in this 100% payout chapter 11 case
is of doubtful, if any, applicability. Moreover, the Reorganized
Debtor's generalized reference to the possibility of equitable
subordination is insufficient to cause us to question the
propriety of the bankruptcy court's exercise of its discretion to
abstain."
John filed proofs of claim, each in the amount of $8.5 million, in
the MMPI case and in another affiliated case. He also filed a
proof of claim in a third affiliated case, but in the amount of
$8 million. He said the bases for the claims include a
contribution agreement; an indemnity agreement; subrogation; and
an employment agreement with the Debtor.
The appellate case is, EVOQ PROPERTIES, INC., f/k/a MERUELO MADDUX
PROPERTIES, INC., Appellant, v. JOHN CHARLES MADDUX, Appellee, BAP
No. CC-12-1479-TaPaKi (9th Cir. BAP). A copy of the BAP's April 15
Memorandum is available at http://is.gd/HV93tNfrom Leagle.com.
About Meruelo Maddux
Meruelo Maddux Properties, Inc., and its affiliates filed for
Chapter 11 protection (Bankr. C.D. Cal. Lead Case No. 09-13356) on
March 26, 2009. John N. Tedford, IV, Esq., and Enid M. Colson,
Esq., at Danning Gill, Diamond & Kollitz, LLP, in Los Angeles,
represent the Debtors in their restructuring effort. The Debtors'
financial condition as of Dec. 31, 2008, showed $681,769,000 in
assets and $342,022,000 of debts.
FTI Consulting, Inc., serves as the Debtors' financial advisors,
Ernst & Young as independent auditors and tax advisors, DLA Piper
LLP (US) as special securities and litigation counsel, and Waldron
& Associates, Inc. as real estate appraiser.
The U.S. Trustee appointed an official committee of unsecured
creditors and a separate official shareholders' committee in the
case. SulmeyerKupetz, APC, serves as the Creditors Committee's
counsel and Kibel Green, Inc., as its financial advisor. The
equity committee has sought to retain Ron Orr & Professionals,
Inc., Rodiger Law Office, and Jenner & Block as counsel, and Kibel
Green, Inc. as its financial advisor. The Debtors have hired
Kurtzman Carson Consultants as solicitation and balloting agent.
The Debtors; Legendary Investors Group No. 1, LLC, and East West
Bank; and Charlestown Capital Advisors, LLC and Hartland Asset
Management Corporation have proposed rival reorganization plans in
the case. In mid-January 2011, the Debtors struck a deal with the
Legendary Group to drop the group's competing plan.
Legendary Investors Group No. 1, LLC, is represented in the case
by Jeremy V. Richards, Esq., and Jeffrey W. Dulberg, Esq., at
Pachulski Stang Ziehl & Jones LLP; and Surjit P. Soni, Esq., at
The Soni Law Firm. East West Bank is represented by Curtis C.
Jung, Esq., and Monica H. Lin, Esq., at Jung & Yuen, LLP, and
Elmer Dean Martin III, Esq.
Charlestown Capital Advisors, LLC and Hartland Asset Management
Corporation are represented in the case by Christopher E. Prince,
Esq., Matthew A. Lesnick, Esq., and Andrew R. Cahill, Esq., at
Lesnick Prince LLP.
On June 24, 2011, after trial on competing proposed plans, the
bankruptcy court entered an order confirming the plan of
reorganization proposed by two of MMPI's minority shareholders.
That plan -- by Charlestown Capital Advisors, LLC's and Hartland
Asset Management Corporation -- became effective July 26, 2011.
Under the Plan, Charlestown Capital obtained control of the
reorganized company. The Charlestown Plan provided for payment in
full to holders of undisputed unsecured claims on the Effective
Date and for payment to holders of secured claims either by
surrender of collateral or through payment over a four-year
period.
MF GLOBAL: Coe Defends Self From Monetary Sanction
--------------------------------------------------
Michelle Coe defended herself against the imposition of monetary
sanction, saying her $35 million administrative expense claim is
not "frivolous."
The move comes after U.S. Bankruptcy Judge Martin Glenn vacated
the sanction he imposed against the claimant in his April 18
decision, and ordered her to appear at the May 16 hearing to
explain why she shouldn't be sanctioned.
In a May 2 filing, Ms. Coe said a previous court ruling allows her
to pursue any MF Global entity, except MF Global Holdings Ltd. or
MF Global USA. She added that her administrative expense claim
"was intended to attach to all of the other MF Global entities."
"The claimant had acknowledged the court's warning and did not
intend on taking action on the exempt MF Global entities," Ms. Coe
said.
Ms. Coe brought what she deemed an administrative expense claim
tied to Man Financial's 2005 acquisition of Refco Inc.'s assets
despite warnings from Judge Glenn that she would be sanctioned if
she continued to file frivolous pleadings.
On April 18, Judge Glenn threw out Ms. Coe's $35 million claim,
and ordered her to pay a fine. Barely two weeks after the April
18 ruling, the bankruptcy judge vacated the monetary sanction
against the claimant.
About MF Global
New York-based MF Global -- http://www.mfglobal.com/-- was one of
the world's leading brokers of commodities and listed derivatives.
MF Global provides access to more than 70 exchanges around the
world. The firm also was one of 22 primary dealers authorized to
trade U.S. government securities with the Federal Reserve Bank of
New York. MF Global's roots go back nearly 230 years to a sugar
brokerage on the banks of the Thames River in London.
On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance
USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 11-15059 and 11-5058), after a planned sale to
Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF
Global had $41,046,594,000 in total assets and $39,683,915,000 in
total liabilities.
On Nov. 7, 2011, the United States Trustee appointed the statutory
creditors' committee in the Debtors' cases. At the behest of the
Statutory Creditor's Committee, the Court directed the U.S.
Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the
Bankruptcy Court entered an order approving the appointment of
Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC,
as Chapter 11 trustee.
On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services
LLC and MF Global FX Clear LLC filed voluntary Chapter 11
petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and
11-15810). On Dec. 27, the Court entered an order installing Mr.
Freeh as Chapter 11 Trustee of the New Debtors.
On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary
Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr.
Freeh also was installed as its Chapter 11 Trustee.
Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel. The Garden City Group, Inc., serves as
claims and noticing agent. The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.
The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan
LLP, as investigative counsel; (ii) FTI Consulting Inc., as
restructuring advisors; (iii) Morrison & Foerster LLP, as
bankruptcy counsel; and (iv) Pepper Hamilton as special counsel.
The Official Committee of Unsecured Creditors has retained
Capstone Advisory Group LLC as financial advisor, while lawyers at
Proskauer Rose LLP serve as counsel.
The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers. James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act. He is a partner at Hughes
Hubbard & Reed LLP in New York.
Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.
At a hearing on April 5, the Bankruptcy Court approved MF Global
Holdings' plan to liquidate its assets. Bloomberg News reported
that the court-approved disclosure statement initially told
creditors with $1.134 billion in unsecured claims against the
parent holding company why they could expect a recovery of 13.4%
to 39.1% from the plan. As a consequence of a settlement with
JPMorgan, supplemental materials informed unsecured creditors
their recovery was reduced to the range of 11.4% to 34.4%. Bank
lenders will have the same recovery on their $1.174 billion claim
against the holding company. As a consequence of the settlement,
the predicted recovery became 18% to 41.5% for holders of $1.19
billion in unsecured claims against the finance subsidiary,
one of the companies under the umbrella of the holding company
trustee. Previously, the predicted recovery was 14.7% to 34% on
bank lenders' claims against the finance subsidiary.
MGM RESORTS: Reports $6.5 Million Net Income in First Quarter
-------------------------------------------------------------
MGM Resorts International reported net income attributable to the
Company of $6.54 million on $2.35 billion of revenues for the
three months ended March 31, 2013, as compared with a net loss
attributable to the Company of $217.25 million on $2.28 billion of
revenues for the same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $26.05
billion in total assets, $18.17 billion in total liabilities and
$7.87 billion in total stockholders' equity.
"Our first quarter 2013 results are the best we have reported
since the beginning of the downturn five years ago, led by
improved results at our Las Vegas Strip resorts, a record first
quarter at MGM China and an all-time record at CityCenter," said
Jim Murren, MGM Resorts International Chairman and CEO. "MGM
Resorts International returned to profitability in the quarter and
we are excited about our future."
A copy of the press release is available for free at:
http://is.gd/Clhq0M
About MGM Resorts
MGM Resorts International (NYSE: MGM) --
http://www.mgmresorts.com/-- has significant holdings in gaming,
hospitality and entertainment, owns and operates 15 properties
located in Nevada, Mississippi and Michigan, and has 50%
investments in four other properties in Nevada, Illinois and
Macau.
The Company reported net income of $3.23 billion in 2011 and a net
loss of $1.43 billion in 2010.
Bankruptcy Warning
In the Form 10-K for the year ended Dec. 31, 2011, the Company
said that any default under the senior credit facility or the
indentures governing the Company's other debt could adversely
affect its growth, its financial condition, its results of
operations and its ability to make payments on its debt, and could
force the Company to seek protection under the bankruptcy laws.
* * *
As reported by the TCR on Nov. 14, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on MGM Resorts
International to 'B-' from 'CCC+'. In March 2012, S&P revised
the outlook to positive from stable.
"The revision of our rating outlook to positive reflects strong
performance in 2011 and our expectation that MGM will continue to
benefit from the improving performance trends on the Las Vegas
Strip," S&P said.
In March 2012, Moody's Investors Service affirmed its B2 corporate
family rating and probability of default rating. The affirmation
of MGM's B2 Corporate Family Rating reflects Moody's view that
positive lodging trends in Las Vegas will continue through 2012
which will help improve MGM's leverage and coverage metrics,
albeit modestly. Additionally, the company's declaration of a $400
million dividend ($204 million to MGM) from its 51% owned Macau
joint venture due to be paid shortly will also improve the
company's liquidity profile. The ratings also consider MGM's
recent bank amendment that resulted in about 50% of its
$3.5 billion senior credit facility being extended one year from
2014 to 2015.
As reported by the TCR on Oct. 15, 2012, Fitch Ratings has
affirmed MGM Resorts International's (MGM) Issuer Default Rating
(IDR) at 'B-' and MGM Grand Paradise, S.A.'s (MGM Grand Paradise)
IDR at 'B+'.
NATIONAL BANK OF GREECE: Incurs EUR2.52-Bil. Net Loss in 2012
-------------------------------------------------------------
National Bank of Greece S.A. filed with the U.S. Securities and
Exchange Commission on May 2, 2013, its annual report on Form 20-F
for the year ended Dec. 31, 2012.
Deloitte Hadjipavlou, Sofianos & Cambanis S.A. expressed
substantial doubt about National Bank of Greece's ability to
continue as a going concern, citing the Group's losses from
operations resulting from the impact of the impairment losses from
the Greek Sovereign debt restructuring and the shareholders
capital deficiency.
The Company reported a net loss of EUR2.518 billion in 2012,
compared with a net loss of EUR14.507 billion in 2011.
Net interest income before provision for loan losses for 2012 was
EUR3.200 Billion, a decrease of 12.3% for 2012, compared to
EUR3.648 billion in 2011. Net interest margin was at 3.4% in 2012
and 3.6% in 2011, due to the pressure from competition in domestic
deposit gathering and to the higher rates paid from the wholesale
funding.
During 2012, the Group recognized Other-Than Temporary-Impairment
charges of EUR410.5 million for debt and equity securities,
compared to OTTI charges of EUR9.174 billion for debt and equity
during 2011.
The Company's balance sheet at Dec. 31, 2012, showed
EUR101.156 billion in total assets, EUR106.949 billion in total
liabilities, Temporary equity of EUR256.7 million, and total
permanent equity of EUR(6.049) billion.
A copy of the Form 20-F is available at http://is.gd/4plOvH
Athens-based National Bank of Greece S.A. holds a significant
position in Greece's retail banking sector, with 511 branches and
1,348 ATMs as at Dec. 31, 2012. NBG's core focus outside of
Greece is in Turkey and South Eastern Europe, where the Company
currently operates in Bulgaria, Serbia, Romania, Albania, Cyprus
and the Former Yugoslavian Republic of Macedonia.
NITRO PETROLEUM: Montomery Coscia Raises Going Concern Doubt
------------------------------------------------------------
Nitro Petroleum Incorporated filed on May 1, 2013, its annual
report for the fiscal year ended Jan. 31, 2013.
Montgomery Coscia Greilich, LLP, in Plano, Texas, expressed
substantial doubt about Nitro Petroleum's ability to continue as a
going concern, citing the Company's substantial accumulated
deficit and working capital deficiency.
The Company reported a net loss of $546,128 on $677,667 of total
revenues for the fiscal year ended Jan. 31, 2013, compared with a
net loss of $276,100 on $400,244 of total revenues for the fiscal
year ended Jan. 31, 2012.
Cost of continued operations for the fiscal year ended Jan. 31,
2013 was $1.2 million resulting in a net operating loss for the
period of $546,128. Cost of continued operations for the fiscal
year ended Jan. 31, 2012 was $706,195, resulting in a net
operating loss for the period of $305,951.
The Company's balance sheet at Jan. 31, 2013, showed $1.4 million
in total assets, $544,995 in total liabilities, and shareholders'
equity of $871,217.
A copy of the Form 10-K is available at http://is.gd/20NhKq
Shawnee, Okla.-based Nitro Petroleum Incorporated is engaged in
the acquisition and exploration of gas and oil properties. All of
the Company's proved reserves are located within the United
States.
NORTHLAND RESOURCES: Bondholders Back Restructuring Proposal
------------------------------------------------------------
Northland Resources S.A. on May 3 disclosed that existing
bondholders voted in favor of the contemplated restructuring
proposal.
Northland announced in a press release dated April 29, 2013, that
the Company had reached agreements with representatives of the
holders of the US$370 million senior secured bonds as well as the
bondholders' financial advisor, to restructure the existing bonds,
offer a new US$362 million senior secured bond and release the
remaining amounts on the Debt Service Accounts to the Company.
On May 3, 2013 Bondholder's Meeting were held pursuant to summons
of April 29, 2013. There were sufficient Bondholders present at
both meetings to form a quorum. The proposed resolution obtained
89.04% of votes in respect of the 13% Bonds and 100% of the votes
in respect of the 12.25% Bonds. The proposal was adopted
according to the voting requirements of the Bond Agreement for
both Bonds.
MCTO
As reported by the Troubled Company reporter on April 29, 2013,
Northland Resources S.A. provided its second bi-weekly Default
Status Report under National Policy 12-203 - Cease Trade Orders
for Continuous Defaults.
On March 28, 2013, the Company announced that the filing of its
audited financial statements and associated management discussion
and analysis for the fiscal year ended December 31, 2012, would
not be completed by the filing deadline set by Canadian securities
laws.
As a result of this delay in filing the Annual Filings and the
application by the Company for a management cease trade order (a
"MCTO"), the Ontario Securities Commission issued a MCTO, which
imposes certain restrictions on the issuance and acquisition of
securities of insiders and/or employees of the Company until the
Company files the Annual Filings and related CEO and CFO
certificates. The MCTO will not affect the ability of persons who
are not insiders or employees of Northland to trade their
securities.
Pursuant to the provisions of the alternative information
guidelines specified by NP 12-203, the Company reports that, since
the issuance of its default announcement on March 28, 2013, except
as stated in this Default Status Report, there have not been any
material changes to the information contained therein; nor any
failure by the Company to fulfill its intentions as stated therein
with respect to satisfying the provisions of the alternative
information guidelines; and there are no additional defaults or
anticipated defaults subsequent to the disclosure therein, other
than the delay in filing the Annual Filings and related CEO and
CFO certificates. Further, there is no additional material
information respecting the Company and its affairs that has not
been generally disclosed.
The Company expects to file the required Annual Filings and
related CEO and CFO certificates on or before Tuesday, April 30,
2013. If this does not occur, the Company intends to file the
third Default Status Report on or about May 9, 2013.
Headquartered in Luxembourg, Northland Resources S.A. (OMX:NAURO)
-- is a producer of iron ore concentrate, with a portfolio of
production, development and exploration mines and projects in
northern Sweden and Finland. The first construction phase of the
Kaunisvaara project is complete and production ramp-up started in
November 2012. The Company produces high-grade, high-quality
magnetite iron concentrate in Kaunisvaara, Sweden, where the
Company will exploit two magnetite iron ore deposits, Tapuli and
Sahavaara. Northland has entered into off-take contracts with
three partners for the entire production from the Kaunisvaara
project over the next seven to ten years. The Company is also
preparing a Definitive Feasibility Study for its Hannukainen Iron
Oxide Copper Gold project in Kolari, northern Finland and for the
Pellivuoma deposit, which is located 15 km from the Kaunisvaara
processing plant.
NXT ENERGY: Reports CR$2.1-Mil. Net Income in 2012
--------------------------------------------------
NXT Energy Solutions Inc. filed on April 30, 2013, its annual
report on Form 20-F for the year ended Dec. 31, 2012.
KPMG LLP, in April 16, 2013, said, "Without qualifying our
opinion, we draw attention to Note 1 in the consolidated financial
statements, which indicates that NXT Energy Solutions Inc. has
uncertainty about the timing and magnitude of future revenues.
These conditions, along with other matters as set forth in Note 1,
indicate the existence of a material uncertainty that casts
substantial doubt about the Company's ability to continue as a
going concern."
The Company said in Note 1: "There is substantial doubt about the
appropriateness of the use of the going concern assumption,
primarily due to current uncertainty about the timing and
magnitude of future SFD(R) survey revenues. NXT recognizes that
it has limited ability to support operations significantly beyond
2013 without generating sufficient new revenue sources or securing
additional financing if required.
The Company reported net income of C$2.1 million on C$10.9 million
of survey revenue in 2012, compared with a net loss of
C$3.6 million on C$144,650 of survey revenue in 2011.
According to the regulatory filing, the company realized a
significant expansion in survey activity in 2012, completing
projects in a total of 4 different countries (Colombia, Argentina,
Guatemala, and Mexico), and generated revenues of C$10.9 million.
The Company's balance sheet at Dec. 31, 2012, showed C$7.4 million
in total assets, C$2.2 million in total liabilities, and
stockholders' equity of C$5.2 million
A copy of the Form 20-F is available at http://is.gd/Ejo7tD
A copy of the consolidated financial statements is available at:
http://is.gd/55FoEZ
Calgary, Canada-based NXT Energy Solutions Inc. was incorporated
under the laws of the State of Nevada on Sept. 27, 1994., and
continued from the State of Nevada to the Province of Alberta,
Canada on Oct. 24, 2003. NXT is a technology company focused on
providing a service to oil and natural gas exploration clients
using our proprietary SFD(R) survey system. The SFD(R) system is
a remote sensing airborne survey system for the oil and gas
exploration industry.
OCALA FUNDING: FDIC Looks to Gut BofA's $2-Bil. Suit Over Fraud
---------------------------------------------------------------
Jamie Santo of BankruptcyLaw360 reported that the The Federal
Deposit Insurance Corp. asked a Washington federal judge Friday to
ax a major claim from Bank of America Corp.'s $1.75 billion
complaint over losses from Taylor Bean & Whitaker Mortgage Corp.'s
alleged fraud, saying no controversy exists because there is
nothing for the bank to recover.
According to the report, acting as indenture trustee for bankrupt
Taylor Bean subsidiary Ocala Funding LLC, Bank of America sued the
FDIC in its role as receiver for Colonial Bank, which allegedly
participated in the fraud that caused Ocala's losses.
The case is Bank of America, National Association v. Federal
Deposit Insurance Corporation, Case No. 1:10-cv-01681 (D.C.).
About Taylor Bean
Taylor, Bean & Whitaker Mortgage Corp. grew from a small Ocala-
based mortgage broker to become one of the largest mortgage
bankers in the United States. In 2009, Taylor Bean was the
country's third largest direct-endorsement lender of FHA-insured
loans of the largest wholesale mortgage lenders and issuer of
mortgage backed securities. It also managed a combined mortgage
servicing portfolio of approximately $80 billion. The company
employed more that 2,000 people in offices located throughout the
United States.
Taylor Bean sought Chapter 11 protection (Bankr. M.D. Fla. Case
No. 09-07047) on Aug. 24, 2009. Taylor Bean filed the Chapter 11
petition three weeks after federal investigators searched its
offices. The day following the search, the Federal Housing
Administration, Ginnie Mae and Freddie Mac prohibited the company
from issuing new mortgages and terminated servicing rights.
Taylor Bean estimated more than $1 billion in both assets and
liabilities in its bankruptcy petition
Lee Farkas, the former chairman, was sentenced in June to 30 years
in federal prison after being convicted on 14 counts of conspiracy
and bank, wire and securities fraud in what prosecutors said was a
$3 billion scheme involving fake mortgage assets.
Jeffrey W. Kelly, Esq., and J. David Dantzler, Jr., Esq., at
Troutman Sanders LLP, in Atlanta, Ga., and Russel M. Blain, Esq.,
and Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain &
Prosser, PA, in Tampa, Fla., represent the Debtors. Paul Steven
Singerman, Esq., and Arthur J. Spector, Esq., at Berger Singerman
PA, in Miami, Fla., represent the Committee. BMC Group, Inc.,
serves as the claims and noticing agent.
Unsecured creditors were expected to receive 3.3% to 4.4% under a
Chapter 11 plan approved in July 2011.
About Ocala Funding
Orange, Florida-based Ocala Funding, LLC, a funding vehicle once
controlled by mortgage lender Taylor Bean & Whitaker Mortgage
Corp., filed a Chapter 11 petition (Bankr. M.D. Fla. Case No.
12-04524) in Jacksonville on July 10, 2012.
Ocala Funding used to be the largest originator and servicer of
residential loans. Ocala was created by Taylor Bean to purchase
loans originated by TBW and selling the loans to third parties,
Freddie Mac. In furtherance of this structure Ocala raised money
from noteholders Deutsche Bank AG and BNP Paribas Mortgage Corp.
and other financial institutions, as secured lenders through sales
of asset-backed commercial paper. Ocala disclosed $1,747,749,787
in assets and $2,650,569,181 in liabilities as of the Chapter 11
filing.
Taylor Bean was forced to file for Chapter 11 relief (Bankr. M.D.
Fla. Case No. 09-07047) on Aug. 24, 2009, amid allegations of
fraud by Taylor Bean's former CEO Lee Farkas and other employees.
Mr. Farkas is now serving a 30-year prison term for 14 counts of
conspiracy and fraud for being the mastermind of a $2.9 billion
bank fraud. Mr. Farkas allegedly directed the sale of more than
$1.5 billion in fake mortgage assets to Colonial Bank and
misappropriated more than $1.5 billion from Ocala. TBW's
bankruptcy also caused the demise of Colonial Bank, which for
years was TBW's primary bank.
TBW and its joint debtor-affiliates confirmed their Second Amended
Joint Plan of Liquidation on July 21, 2011, and the TBW Plan
became effective on Aug. 10, 2011. The TBW Plan established the
TBW Plan Trust to marshal and distribute all remaining assets of
TBW.
Neil F. Lauria, as CRO for TBW and trustee of the TBW Plan Trust,
signed the Chapter 11 petition of Ocala.
Ocala holds 252 mortgage loans with an unpaid balance of $42.3
million as of May 31, 2012. The Debtor also holds five "real
estate owned" properties resulting from foreclosures. The Debtor
also holds $22.4 million in proceeds of mortgage loans previously
owned by it that are on deposit in an account in the Debtor's name
at Regions Bank. It also has an interest in $75 million in cash,
consisting of proceeds of mortgage loans previously owned by the
Debtor, that are in an account maintained by Bank of America, N.A.
as prepetition indenture trustee for the benefit of the
Noteholders. The Debtor also holds a claim in the current amount
of $1.6 billion against the estate of TBW.
The largest unsecured creditors include the Federal Deposit
Insurance Corp., owed $898,873,958; and Cadwalader, Wickersham &
Taft LLP, owed $1,632,385.
Judge Jerry A. Funk presides over Ocala's case. Proskauer Rose
LLP and Stichter, Riedel, Blain & Prosser, serve as Ocala's
counsel. Neil F. Lauria at Navigant Capital Advisors, LLC, serves
as the Debtor's Chief Restructuring Officer.
OMEGA NAVIGATION: Further Modifies Liquidating Plan
---------------------------------------------------
Omega Navigation Enterprises, Inc., and its debtor affiliates
modified their Joint Plan of Liquidation to provide that the Plan
will be funded by the cash proceeds received as a result of the
closing of the sales of the equity interests in the Debtors.
The Equity Interest Proceeds consist of f (i) $50,000 for the
Equity Interests in Omnicrom Holdings, Ltd., plus (ii) $10,000 for
the Equity Interests in Omega Management, Inc., and Taylor, plus
(iii) $4,000,000 for the Equity Interests in Omega Investments
Ltd.; provided, however, that if Delos Megacore Ltd. pursues an
appeal from the Bankruptcy Court's Order Denying Motion of Delos
Megacore Ltd. for Approval of Break-Up Fee, the Equity Interests
Proceeds will be minus the amount of the "break-up fee," if any,
awarded pursuant to a Final Order.
Allowed Junior Lenders' Claims (Class 2) are impaired. The JL
Adequate Protection Claims will be allowed in the amount of the
Junior Lenders' settlement with the Debtors. The Junior Lenders
will not receive any distributions on their deficiency claims.
Released Related Persons' Claims (Class 3) are impaired and will
not receive any distributions. However, pursuant to a settlement
with the Debtors, the Released Related Persons will be deemed to
have voted to accept the Plan.
Allowed General Unsecured Claims (Class 4) are impaired and will
receive from the available amounts their pro rata share. Allowed
Intercompany Claims (Class 5) will be cancelled. Allowed
Interests (Class 6) will not receive any distributions. Interests
in all Debtors will be cancelled.
The hearing to consider confirmation of the Plan of Reorganization
will be continued on May 13, 2013, at 02:00 PM.
A full-text copy of the Second Amended Plan dated April 22, 2013,
is available for free at:
http://bankrupt.com/misc/OMEGANAVIGATIONplan0424.pdf
About Omega Navigation
Athens, Greece-based Omega Navigation Enterprises Inc. and
affiliates, owner and operator of tankers carrying refined
petroleum products, filed for Chapter 11 protection (Bankr. S.D.
Tex. Lead Case No. 11-35926) on July 8, 2011, in Houston, Texas
in the United States.
Omega is an international provider of marine transportation
services focusing on seaborne transportation of refined petroleum
products. The Debtors disclosed assets of US$527.6 million and
debt totaling US$359.5 million. Together, the Debtors wholly own
a fleet of eight high-specification product tankers, with each
vessel owned by a separate debtor entity.
HSH Nordbank AG, as the senior lenders' agent, has first liens on
vessels to secure a US$242.7 million loan. The lenders include
Bank of Scotland and Dresdner Bank AG. The ships are encumbered
with US$36.2 million in second mortgages with NIBC Bank NV as
agent. Before bankruptcy, Omega sued the senior bank lenders in
Greece contending they violated an agreement to grant a three
year extension on a loan that otherwise matured in April 2011.
An affiliate of Omega that manages the vessels didn't file, nor
did affiliates with partial ownership interests in other vessels.
Judge Karen K. Brown presides over the case. Bracewell &
Giuliani LLP serves as counsel to the Debtors. Jefferies &
Company, Inc., is the financial advisor and investment banker.
The Official Committee of Unsecured Creditors has tapped Winston
& Strawn as local counsel; Jager Smith as lead counsel; and First
International as financial advisor.
ORANGE GROVE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Orange Grove Center Group, LLC
1250 Tamiami Trail North, Suite 211
Naples, FL 34102
Tel: (239) 330-2359
Bankruptcy Case No.: 13-05860
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Middle District of Florida (Ft. Myers)
Judge: Caryl E. Delano
Debtor's Counsel: John S. Sarrett, Esq.
JOHN S. SARRETT, P.A.
9140 Corsea Del Fontana Way, Suite 120
Naples, FL 34109
Tel: (239) 330-2359
Fax: (239) 790-5063
E-mail: jsarrett@sarrettlaw.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/flmb13-05860.pdf
The petition was signed by James W. Field, managing member.
ORCKIT COMMUNICATIONS: Redemption of $5MM Secured Noted Okayed
--------------------------------------------------------------
The trustee of Orckit's Series A notes published the results of a
meeting held by the Series A note holders, as follows:
1. The proposal to authorize the trustee to initiate legal
proceedings (including involuntary liquidation proceedings)
against Orckit was not approved; and
2. The proposal to request that Orckit redeem the secured notes
held by two funds affiliated with Hudson Bay Capital in the
aggregate principal amount of $5 million was approved.
In addition, on April 30, 2013, following prior discussions on the
terms of a possible arrangement providing for the retirement in
full of Orckit's Series A notes and Series B notes, Orckit
presented to its note holders its final proposed terms for such an
arrangement. Orckit has been informed that the trustees of both
series of notes support the appointment of an expert on behalf of
the court to opine on the terms of the Arrangement.
In exchange for the notes and the full retirement thereof, each
note holder would receive consideration that consists of four
elements: (i) a cash payment, (ii) shares of Networks Inc., (iii)
shares of Orckit and (iv) warrants to purchase shares of Orckit.
Orckit would undertake, for a period of four years, not to issue
shares or any other securities exercisable for or convertible into
shares at a price lower than $0.52 per share.
As of the consummation of the Arrangement, all the parties to the
Arrangement would waive any claim or remedy against one another
arising on or prior to that time, including any claim or remedy
with respect to the Arrangement.
The Arrangement is subject to the satisfaction of the following
material conditions:
* The approval of the Series A note holders, the Series B note
holders and Orckit's shareholders pursuant to Section 350 of
the Israeli Companies Law; and
* The approval of the Israel Securities Authority, the Tel Aviv
Stock Exchange and the Tel Aviv District Court.
A full-text copy of the Form 8-K is available for free at:
http://is.gd/TVK0cw
About Orckit
Tel-Aviv, Israel-based Orckit Communications Ltd. (TASE: ORCT)
engages in the design, development, manufacture and marketing of
advanced telecom equipment to telecommunication service providers
in metropolitan areas. The Company's products are transport
telecommunication equipment targeting high capacity packetized
metropolitan networks.
ORCKIT Communications disclosed a net loss of $6.46 million on
$11.19 million of revenues for the year ended Dec. 31, 2012, as
compared with a net loss of $17.38 million on $15.58 million of
revenues for the year ended Dec. 31, 2011.
The Company's balance sheet at Dec. 31, 2012, showed $15.49
million in total assets, $23.88 million in total liabilities and a
$8.38 million total capital deficiency.
Kesselman & Kesselman, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2012. The independent auditors noted that the Company has a
capital deficiency, recurring losses, negative cash flows from
operating activities and has significant future commitments to
repay its convertible subordinated notes. These facts raise
substantial doubt as to the Company's ability to continue as a
going concern.
OVERSEAS SHIPHOLDING: Affiliates File Assets & Debts Schedules
--------------------------------------------------------------
Debtor-affiliates of Overseas Shipholding Group Inc. have filed
with the Bankruptcy Court their schedules of assets and
liabilities, disclosing:
Debtor-Entity Assets Liabilities
------------- ----------- -----------
Overseas Philadelphia LLC $875,450 $940,266
Pisces Tanker Corporation $23,264,463 $24,168,489
Polaris Tanker Corporation $23,096,118 $25,455,425
Overseas Puget Sound LLC $10,748,360 $6,113,564
Queens Product Tanker Corp. $52,638,741 $71,509,916
OSG Quest LLC $64,071 $201,039
Reymar Limited $79,319,089 $33,176,649
Rich Tanker Corporation $18,844,535 $19,542,224
Rimar Chartering Corporation $54,290,994 $57,565,941
Rosalyn Tanker Corporation $65,264,158 $6,406,632
Rosemar Limited $63,200,911 $24,919,285
Rubymar Limited $76,226,160 $30,303,026
Sakura Transport Corp. $62,803,866 $8,951,900
Samar Product Tanker Corp. $57,582,988 $57,189,575
Santorini Tanker LLC $96,246,812 $74,364,317
Overseas Sea Swift Corp. $9,021 $7,132
Serifos Tanker Corporation $8,716,724 $11,883,902
Seventh Aframax Tanker Corp. $35,909,393 $34,989,733
OSG Ship Management, Inc. $212,373,584 $383,050,744
Shirley Tanker SRL $56,425,678 $62,183,191
Sifnos Tanker Corporation $8,732,820 $12,130,053
Silvermar Limited $56,073,759 $14,750,312
Sixth Aframax Tanker Corp. $31,690,361 $5,849,156
Skopelos Product Tanker Corp. $54,674,796 $17,094,713
Overseas ST Holding LLC $341,229,481 $158,550,907
Star Chartering Corp. $9,115,508 $8,851,504
Talara Chartering Corp. $14,762,579 $21,873,841
Overseas Tampa LLC $8,386,768 $6,866,078
Overseas Texas City LLC $43,981,190 $29,151,509
Third United Shipping Corp. $105,125,307 $0
Tokyo Transport Corp. $66,475,673 $8,494,468
Transbulk Carriers, Inc. $295,381 $210,638
Troy Chartering Corporation $31,987,380 $47,095,696
Troy Product Corporation $58,764,922 $58,344,597
Urban Tanker Corporation $21,457,548 $23,604,439
Vega Tanker Corporation $3,052,146 $8,681
View Tanker Corporation $10,432,101 $11,439,776
Vivian Tankships Corporation $6,626,720 $0
Vulpecula Chartering Corp. $25,756,822 $25,618,119
Wind Aframax Tanker Corp. $61,272 $0
Copies of the Schedules are available at:
* Overseas Philadelphia LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_philadelphia_sal.pdf
* Pisces Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_pisces_sal.pdf
* Polaris Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_polaris_sal.pdf
* Overseas Puget Sound LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_puget_sal.pdf
* Queens Product Tanker Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_queens_sal.pdf
* OSG Quest LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_quest_sal.pdf
* Reymar Limited
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_reymar_sal.pdf
* Rich Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_rich_sal.pdf
* Rimar Chartering Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_rimar_sal.pdf
* Rosalyn Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_rosalyn_sal.pdf
* Rosemar Limited
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_rosemar_sal.pdf
* Rubymar Limited
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_rubymar_sal.pdf
* Sakura Transport Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_sakura_sal.pdf
* Samar Product Tanker Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_samar_sal.pdf
* Santorini Tanker LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_santorini_sal.pdf
* Overseas Sea Swift Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_sea_sal.pdf
* Serifos Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_serifos_sal.pdf
* Seventh Aframax Tanker Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_seventh_sal.pdf
* OSG Ship Management, Inc.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_ship_sal.pdf
* Shirley Tanker SRL
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_shirley_sal.pdf
* Sifnos Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_sifnos_sal.pdf
* Silvermar Limited
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_silvermar_sal.pdf
* Sixth Aframax Tanker Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_sixth_sal.pdf
* Skopelos Product Tanker Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_skopelos_sal.pdf
* Overseas ST Holding LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_st_sal.pdf
* Star Chartering Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_star_sal.pdf
* Talara Chartering Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_talara_sal.pdf
* Overseas Tampa LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_tampa_sal.pdf
* Overseas Texas City LLC
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_texas_sal.pdf
* Third United Shipping Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_third_sal.pdf
* Tokyo Transport Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_tokyo_sal.pdf
* Transbulk Carriers, Inc.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_transbulk_sal.pdf
* Troy Chartering Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_troy_sal.pdf
* Troy Product Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_troyproduct_sal.pdf
* Urban Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_urban_sal.pdf
* Vega Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_vega_sal.pdf
* View Tanker Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_view_sal.pdf
* Vivian Tankships Corporation
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_vivian_sal.pdf
* Vulpecula Chartering Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_vulpecula_sal.pdf
* Wind Aframax Tanker Corp.
http://bankrupt.com/misc/OVERSEAS_SHIPHOLDING_wind_sal.pdf
About Overseas Shipholding
Overseas Shipholding Group, Inc., headquartered in New York, is
one of the largest publicly traded tanker companies in the world,
engaged primarily in the ocean transportation of crude oil and
petroleum products. OSG owns or operates 111 vessels that
transport oil and petroleum products throughout the world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. Cleary Gottlieb
Steen & Hamilton LLP serves as OSG's Chapter 11 counsel, while
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
PACIBEL LLC: Case Summary & Largest Unsecured Creditor
------------------------------------------------------
Debtor: Pacibel, LLC
22728 Ventura Boulevard, Unit A
Woodland Hills, CA 91364
Bankruptcy Case No.: 13-12960
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Central District of California (San Fernando Valley)
Judge: Alan M. Ahart
Debtor's Counsel: Raymond H. Aver, Esq.
LAW OFFICES OF RAYMOND H AVER APC
1950 Sawtelle Blvd., Suite 120
Los Angeles, CA 90025
Tel: (310) 473-3511
Fax: (310) 473-3512
E-mail: ray@averlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
In its list of 20 largest unsecured creditors, the Company placed
only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
US Bank National loan $17,200,000
Association, as Trustee
for registered holders of
Merrill Lynch
12100 Wilshire Blvd.
Los Angeles, CA 90025
The petition was signed by Homayoun "Tony" Namvar, manager.
PACKAGING DYNAMICS: Paper Unit Divestiture No Impact on B2 CFR
--------------------------------------------------------------
Packaging Dynamics Corporation's plan to divest its specialty
papers business is viewed as credit neutral at this point, but
could impact the ratings depending on the amount and use of the
net proceeds.
Moody's carries these ratings for Packaging Dynamics:
LT Corporate Family Ratings (Domestic); B2
Senior Secured (Domestic); B3
Probability of Default; B2-PD
Packaging Dynamics Corporation is a manufacturer and converter of
value-added food packaging products, specialty bleached and
unbleached lightweight papers, and flexible adhesive lamination
structures. Headquartered in Chicago, Packaging Dynamics is a
portfolio company of private equity investment firm Kohlberg &
Company.
PANDA TEMPLE II: S&P Rates First Lien $372-Mil. Term Loan 'B'
-------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B' senior
secured rating and '3' recovery rating to Panda Temple II Power
LLC's (Temple II) first-lien senior secured $372 million term loan
B. The '3' recovery rating indicates meaningful recovery (50% to
70%) of principal in a default scenario. The outlook is stable.
Temple II is a special-purpose, bankruptcy-remote operating
entity, set up to build the Panda Temple II Power Plant, a 758-
megawatt (MW) natural gas-fired plant in Temple, Texas, about 130
miles south of Dallas. The unit will dispatch into the North sub-
region of the Electric Reliability Council of Texas (ERCOT) market
and abut the Panda Temple I facility, a project-financed power
plant currently under construction and scheduled to begin
operations in August 2014 (one year before Temple II). Temple II
will initially be capitalized with $312 million of equity and
$372 million of secured debt.
S&P expects project construction will last until 2015. When
complete, Temple II will generate revenue by selling electricity
into the ERCOT market. S&P expects revenues to be volatile,
although financial hedges will slightly mute the volatility.
Initial leverage is about $491 per kilowatt (kW), falling to $116
per kW under its base case assumptions at maturity (April 2019)
but a more aggressive level of $380 per kW under reasonable stress
scenarios. By way of reference, power plants in the region have
sold in the $300 to $400 per kW area in more difficult market
conditions.
The 'B' rating reflects S&P's view of the following weaknesses:
-- Margin (spark spread) volatility on the unhedged portion of
electricity sales. Cash flow volatility is high relative to
most other rated projects due to the absence of revenue-
stabilizing mechanisms such as a power purchase agreement or
capacity market payments.
-- Fluctuations in power prices and the plant's capacity factor
(which are partially influenced by reserve margins and the
relative efficiency of newly built plants in the ERCOT
region) greatly affect cash flows.
-- Operating risk associated with availability of the facility
and its average efficiency (heat rate) over time. This
operating risk is amplified by the project's single-asset
nature.
-- Refinancing risk in 2019 under Standard & Poor's base case,
given the minimal required amortization payments over the
debt tenor.
-- Greenfield construction risk, although S&P recognizes that
the design and technology are fairly standard.
The following strengths mitigate weaknesses at the 'B' rating
level:
-- Merchant exposure is partially mitigated with a revenue
hedge from 3M Employee Retirement Income Plan (unrated; a
subsidiary of 3M Co.) for 80% of nameplate MW capacity from
2016 to 2019.
-- Lenders benefit from structural protections, including a
100% cash flow sweep, after operations and maintenance
expenses and interest, a six-month debt service reserve, a
six-month major maintenance reserve, and limitations on
distributions.
-- While S&P expects the project's merchant revenue streams to
be volatile, it has a generally favorable view of the
supply-demand dynamics in the ERCOT market. S&P projects
reserve margins expectations to be tight, which should
support higher power prices.
-- Terms of the construction contract, including performance
guarantees, support credit quality. Moreover, the
engineering, procurement, and construction (EPC)
contractors -- Bechtel Power Corp. and Siemens Energy Inc.
-- are market leaders with strong track records of
delivering on time and within budget.
-- The rich network of pipelines in ERCOT North and Temple II's
interconnection with Atmos Energy Corp.'s intrastate
pipeline provide ample natural gas supply to the plant, as
well as access to multiple liquid market hubs.
Bechtel and Siemens will build the project jointly and severally,
under a fixed-price, date-certain turnkey EPC contract. S&P
believes the project will marginally benefit from some
infrastructure already in place from Temple I, such as electrical
and fuel interconnects. Temple II's heat-recovery steam
generators, steam turbines, and combustion turbines at the
facility are all proven technologies at existing plants. Given
Bechtel's and Siemens' long track records and market leadership in
this industry, Standard & Poor's is comfortable that these
counterparties' creditworthiness will not limit the rating on
Temple II's debt. In S&P's opinion, the fixed EPC arrangement
supports credit because it mitigates construction risk.
Although the plant has some merchant risk, it benefits from a
revenue put option for 600 MW of generation capacity, which
provides underlying support for gross margin of $45 million per
year between 2016 and 2019. The hedge provides a floor even as
the project retains the upside should spark spreads widen or heat
rates expand. This hedge improves cash flow stability through
2019. However, it is financially settled and may not be
completely effective because gas is not perfectly correlated to
on-peak electricity, and if gas is on the margin less frequently
than expected, the ineffectiveness of the hedge would likely be
amplified. In addition, the hedge does not cover lower margins
arising from weaker-than-expected operational performance.
The term loan B facility is a six-year, $372 million term loan,
with 1% mandatory annual amortization payments but a 100% cash
sweep (i.e., any free cash flow go to repay debt). It is secured
by a first-priority perfected lien on the project's property,
commercial agreements, and assets. Prepayments are mandatory for
net asset sale proceeds (100%), new debt issuance (100%), and new
equity issuance (100%). The credit agreement has negative
covenants preventing additional debt, liens, guarantees, mergers
and acquisitions, certain asset sales, restricted payments,
transactions with affiliates, and unapproved capital spending and
investments.
Because there are no capacity markets in the ERCOT region, S&P
expects plant cash flows to be highly volatile for the unhedged
portion of the capacity (158 MW) and, starting in 2020, for all
the capacity once the revenue put option rolls off. Projects in
other regions often generate some revenue from capacity payments,
which are less volatile. That said, S&P has a generally favorable
view of power markets in Texas due to declining reserve margins
from increasing load and the planned retirement of coal units that
helps to improve market heat rates.
A key assumption in S&P's base case is that market heat rates and
realized margins will continue to rise due to increasing load and
planned coal plant retirements that will push reserve margins in
ERCOT below 13%. However, if current trends do not continue and
weaker demand or the significant introduction of more efficient
generation lowers market heat rates and prices, S&P could
significantly lower its market assumptions, pressuring the rating.
S&P's natural gas price deck forms its view on power prices in the
ERCOT region ($3.50 per million Btu in 2015 and rising with
inflation thereafter), which S&P assumes to be in the $60 to $65
per MW-hour range. In addition, S&P assumes utilization rates in
the 45% to 55% area, recognizing that they can be highly volatile.
The forecast debt service coverage ratio (DSCR) under this
scenario is robust, averaging 3.17x between 2015 and 2019, and
5.33x at maturity. S&P notes that the DSCRs are high relative to
peers that have fully amortizing structures, given Temple II's
minimal mandatory amortization payments.
Given the highly volatile cash flows, S&P's sensitivity cases were
of most interest to them and were the focus of the rating outcome.
Under moderate downside scenarios, DSCRs fell sharply compared
with S&P's base case, with power prices and capacity factors
(which are partially influenced by reserve margins and the
relative efficiency of newly built plants in the ERCOT region)
having the most effect. For example, a 10% to 15% stress on
capacity and power price inputs leads to a minimum DSCR of 1.02x
and high debt at maturity of $380 per kW.
PARADISE VALLEY: Plan Outline Has Conditional Approval
------------------------------------------------------
The U.S. Bankruptcy Court for the District of Montana will convene
a hearing to consider confirmation of Paradise Valley Holdings
LLC's Amended Chapter 11 plan and final approval of the disclosure
statement at a hearing on June 4, at 9:00 a.m.
The bankruptcy judge has granted conditional approval of the
disclosure statement and set the June 4 hearing, a May 28 deadline
for objections and a May 28 deadline for sending written
acceptances and rejections of the Plan. At the June 4 hearing, if
final approval of the Disclosure Statement is denied, approval of
the Plan will not be considered.
The Plan is premised upon the sale of the Debtor's real property
three years after the effective date of the Plan. Secured
creditors Park County, Montana (Class I) and American Bank and
Museum of the Rockies (Class II) will retain their liens on the
property.
The Debtor will reject all contracts and unexpired leases, except
the real estate listing contract with Hall & Hall. The Debtor has
listed with Hall & Hall, a nationally known and reputable broker
of high end agricultural and recreational property, the real
property for sale for $14.5 million.
If the real property has not been sold by the third anniversary
date of the effective date of the Plan, the Class II claimant,
American Bank, will be allowed to exercise its state law rights to
foreclose its lien; on foreclosure, the surplus will be paid to
the creditors in accordance with the Plan. No sale of the
property, or any portion thereof, will occur without the consent
of American Bank.
The American Bank obtained an appraisal of the real property in
March, 2012. The value of the Real Property as determined in the
appraisal is $14.04 million based on a 72-month marketing period.
The Debtor's total debt is estimated to be $3,597,283.
The secured creditors, the general unsecured creditors will be
paid with interest from the sale of the Debtors' real property.
Holders of general unsecured claims of $1,000 or less (Class IV)
will receive full payment of their allowed claim, within one year
of the confirmation date. The Debtor's members will also be paid
from the proceeds of the sale after higher ranked classes are paid
in full.
A copy of the Fourth Amended Disclosure Statement is available at:
http://bankrupt.com/misc/paradisevalley.doc80.pdf
About Paradise Valley
Paradise Valley Holdings LLC, a member managed Montana limited
liability company, filed for Chapter 11 protection (Bankr. D.
Mont. Case No. 12-61585) in Butte, Montana on Sept. 28, 2012. The
member holding the largest membership interest, approximately 72
percent, is Wade Dokken. Wade Dokken and his wife, Susi, are
creditors of the Debtor. Wade Dokken is a shareholder of Ameya
Preserve Inc., a Montana corporation.
Paradise Valley purchased what is known as the Bullis Creek Ranch
in 2005. At the time of its purchase the ranch was comprised of
10,771 acres. The property was purchased for the purpose of a
Luxury recreational home development. In 2008, the Debtor sold a
portion of its real property, realizing a gain of $14,246,665.
The developer was to be Ameya Preserve Inc, an entity affiliated
With the DIP. While Ameya Preserve was to be the developer, the
DIP was to retain ownership of the real property, pending a
transfer to Ameya Preserve.
The Real Property consists of 4840 acres and a 8182 square foot
ranch log home built in 1999 with five bedrooms, four baths and a
three car garage. The Real Property is located south and west of
Livingston, Montana in the northwest corner of Paradise Valley.
Paradise Valley disclosed $14.2 million in total assets and
$13.1 million in total liabilities. A copy of the schedules is
available at http://bankrupt.com/misc/mtb12-61585.pdf
Judge Ralph B. Kirscher oversees the case. James A. Patten, Esq.,
at Patten, Peterman, Bekkedahl & Green, P.L.L.C., in Billings,
Montana, serves as the Debtor's legal counsel.
PARK CITY: Case Summary & 2 Unsecured Creditors
-----------------------------------------------
Debtor: Park City Sports Center, Inc.
dba Shenk & Tittle
Attn: Harlowe R. Prindle
888 Far Hills Drive
New Freedom, PA 17349-8428
Bankruptcy Case No.: 13-02288
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Middle District of Pennsylvania (Harrisburg)
Judge: Mary D. France
Debtor's Counsel: Lawrence V. Young, Esq.
CGA LAW FIRM
135 North George Street
York, PA 17401
Tel: (717) 848-4900
Fax: (717) 843-9039
E-mail: lyoung@cgalaw.com
Scheduled Assets: $455,854
Scheduled Liabilities: $1,482,132
A copy of the Company's list of its two largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/pamb13-2288.pdf
The petition was signed by Harlowe R. Prindle, president.
PATRIOT COAL: MSHA Vacates Imminent Danger Order vs. Remington
--------------------------------------------------------------
Remington LLC received an imminent danger order under Section
107(a) of the Mine Act at the Winchester underground mine on
April 25, 2013. During a routine inspection, an MSHA inspector
purportedly observed two employees sitting on a section power
center, which is a metal enclosure that is used to distribute
electrical power to underground mining equipment. The Company
disputed the factual basis of the Order. After conducting further
review, MSHA vacated the Order on April 29, 2013, finding that the
situation did not present an imminent danger under Section 107(a).
No employees were harmed or endangered, and production remained
unaffected.
On July 21, 2010, the Dodd-Frank Wall Street Reform and Consumer
Protection Act was enacted. Section 1503 of the Dodd-Frank Act
requires a Current Report on Form 8-K if a company is issued an
imminent danger order under Section 107(a) of the Federal Mine
Safety and Health Act of 1977 by the federal Mine Safety and
Health Administration.
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.
PBG PROPERTIES: Case Summary & 4 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: PBG Properties, Ltd.
3106 Suzanne
Rowlett, TX 75088
Bankruptcy Case No.: 13-32149
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Harlin DeWayne Hale
Debtor's Counsel: Eric A. Liepins, Esq.
ERIC A. LIEPINS, P.C.
12770 Coit Rd., Suite 1100
Dallas, TX 75251
Tel: (972) 991-5591
E-mail: eric@ealpc.com
Scheduled Assets: $2,200,000
Scheduled Liabilities: $585,137
A copy of the Company's list of the Company's four unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/txnb13-32149.pdf
The petition was signed by Jerry Gossett, authorized
representative of general partner.
PENSACOLA BEACH: Files for Chapter 11 in Florida
------------------------------------------------
Pensacola Beach LLC filed a bare-bones Chapter 11 petition (Bankr.
N.D. Fla. Case No. 13-30569) in Pensacola, Florida, on May 2.
The Debtor is a single asset real estate under 11 U.S.C. Sec.
101(51B) and said total assets and debts exceed $10 million. The
Debtor was also known as Springhill Suites by Marriott hotel in
Pensacola Beach, Florida.
The Debtor is represented by Sherry F. Chancellor, Esq., at The
Law Office of Sherry F. Chancellor.
PENSACOLA BEACH: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Pensacola Beach, LLC
aka Springhill Suites by Marriott Pns Beach
24 Via de Luna
Gulf Breeze, FL 32561
Bankruptcy Case No.: 13-30569
Chapter 11 Petition Date: May 2, 2013
Court: U.S. Bankruptcy Court
Northern District of Florida (Pensacola)
Judge: William S. Shulman
Debtor's Counsel: Sherry F. Chancellor, Esq.
THE LAW OFFICE OF SHERRY F. CHANCELLOR
619 West Chase Street
Pensacola, FL 32502
Tel: (850) 436-8445
E-mail: sherry.chancellor@yahoo.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by David Brannen, managing member.
Debtor?s List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Premium Assignment Corporation Vendor Claim for $111,559
P.O. Box 8000 Insurance
Tallahassee FL 32314-8000
Gulf Power Electric Service $12,600
1 Energy Place
Pensacola FL 32520-0037
Advantage Resourcing Vendor Claim $1,443
P.O. Box 277534
Atlanta GA 30384
Marriott Int'l DOM Franchise Franchise Fees $0
Southern Wine and Spirits -- $0
AT&T -- $0
Escambia County Tax -- $0
Saltmarsh, Clevaland & Gund -- $0
Springhill Suites Payroll -- $0
HH Employee Retirement -- $0
Florida Dept. of Revenue -- $0
ECUA -- $0
Buffalo Rock -- $0
Springhill Suites GM Acct -- $0
Florida Dept. Of State -- $0
Hobart Service -- $0
SRIA -- $0
Florida Dept. of Revenue -- $0
Florida Dept. of Revenue -- $0
Highpointe Hospitality, Inc. -- $0
PHYSIOTHERAPY ASSOCIATES: Default Cues Moody's to Cut CFR to Caa3
-----------------------------------------------------------------
Moody's Investors Service downgraded Physiotherapy Associates
Holdings, Inc.'s Corporate Family Rating to Caa3 from B3 and
Probability of Default Rating to Caa3-PD from B3-PD. Concurrently,
the senior secured ratings are lowered to Caa1 from Ba3 and the
senior unsecured notes are lowered to Ca from Caa1. The ratings
remain under review for possible downgrade. The Caa1 (LGD 2, 22%)
rating and LGD assessment on the senior secured credit facilities
represents Moody's current fundamental analysis on the ultimate
recovery values.
The downgrade reflects Physiotherapy's announcement that it
elected to not make the $12.5 million interest payment due on
May 1 on its senior notes. The company has a 30-day grace period.
Furthermore, the election to not make its interest payment
terminated the existing waiver under the company's bank credit
agreement, regarding non-delivery of its 2012 audited financial
statements due April 1 and reinstates an event of default under
the credit agreement. If the company fails to cure by the end of
its grace period, Moody's will consider the event a default.
The following ratings have been downgraded and remain under review
for downgrade:
Corporate Family Rating to Caa3 from B3;
Probability of Default Rating to Caa3-PD from B3-PD;
$25 million senior secured revolver to Caa1 (LGD 2, 22%) from
Ba3 (LGD 2, 14%);
$100 million senior secured term loan to Caa1 (LGD 2, 22%) from
Ba3 (LGD 2, 14%);
$210 million senior unsecured notes to Ca (LGD 4, 66%) from
Caa1 (LGD 4, 65%):
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.
Physiotherapy Associates Holdings, Inc.'s provides outpatient
physical therapy services, such as general orthopedics, spinal
care and neurological rehabilitation. The company also provides
orthotics and prosthetics services. The company generated $356
million in gross revenue for the twelve months ended September 30,
2012, before considering the provision for doubtful accounts.
The Exton, Pennsylvania-based company was acquired in May 2012 by
Court Square Capital Partners LP.
POWER BUYER: S&P Retains Prelim. 'B' Rating After Loan Upsizing
---------------------------------------------------------------
Standard & Poor's Ratings Services said that its preliminary issue
ratings on Plymouth, Mich.-based Power Buyer LLC remain unchanged
after the company announced an upsize in its proposed first-lien
term loan to $400 million (up from $385 million) and the second-
lien term loan to $170 million (up from $140 million). S&P rates
the first-lien term loan preliminary 'B' with a preliminary
recovery rating of '3', indicating its expectation for meaningful
(50%-70%) recovery in the event of payment default. S&P rates the
second-lien term loan preliminary 'CCC+' with a preliminary
recovery rating of '6', indicating its expectation for negligible
(0-10%) recovery. The preliminary 'B' corporate credit rating and
stable outlook also remain unchanged.
The amount of the proposed delayed draw first-lien term loan,
which S&P rates preliminary 'B' with a preliminary recovery rating
of '3', remains unchanged at $50 million. S&P expects an
affiliate of Kelso & Co. will use the proceeds of the proposed
upsized term loans to refinance existing debt and partly fund the
acquisition of PowerTeam Services LLC to combine with portfolio
company Power Holdings to operate under Power Buyer LLC. The
total debt increases by $45 million when compared with the
previously proposed structure, resulting in a lower equity
investment from financial sponsor Kelso.
Pro forma for the transaction, S&P still expects the company to
generate positive free cash flow and credit metrics consistent
with a "highly leveraged" financial risk profile, such as total
debt to EBTDA slightly above 6x. S&P expects credit metrics to
remain stable over the intermediate term, given its assumptions
for gradual EBITDA improvements and its assumption that management
will approach growth prudently.
The preliminary ratings on Power Buyer reflects S&P's assessment
of the company's business risk profile as "weak" and financial
risk profile as "highly leveraged." The business profile is
supported by EBITDA margins in the high-teens percentage area as a
regional provider of maintenance and infrastructure services to
electric and gas utilities. The highly leveraged financial
profile reflects the company's substantial debt burden and
ownership by a financial sponsor.
Ratings List
Power Buyer LLC
Corporate Credit Rating B(prelim)/Stable/--
Ratings Remain Unchanged
Power Borrower LLC
PTS Buyer Inc.
Power Buyer LLC
Senior Secured
$400 mil first-lien term loan* B(prelim)
Recovery Rating 3(prelim)
$170 mil second-lien term loan* CCC+(prelim)
Recovery Rating 6(prelim)
*Includes upsize.
POWERWAVE TECHNOLOGIES: KEIP Approval Sought
--------------------------------------------
BankruptcyData reported that Powerwave Technologies filed with the
U.S. Bankruptcy Court a motion to implement a key employee
incentive program (KEIP) for up to 16 senior employees.
Under the KEIP, if the Debtors obtain a qualified bid for the sale
of substantially all the Debtors assets, all KEIP participants
will be eligible for an award in the amount of $250,000 in the
aggregate, the BData report related.
For a successful sale transaction along with a qualified bid, in
the event the Debtors' estate receives over $40,000,000, four of
the employees will receive a percentage, depending on the sale
amount, the BData report added.
The Court scheduled a May 22, 2013 hearing on the motion.
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.
Prepetition secured lender, P-Wave Holdings LLC, is represented by
Martin A. Sosland, Esq., and Joseph H. Smolinsky, Esq., at Weil
Gotshal & Manges LLP; and Mark D. Collins, Esq., and John H.
Knight, Esq., at Richards Layton & Finger.
The Official Committee of Unsecured Creditors has retained Sidley
Austin LLP; Young Conaway Stargatt & Taylor LLP; and Zolfo Cooper,
LLC.
PRIMECARE MEDICAL: Moody's Places 'Ba2' IFS on Review for Upgrade
-----------------------------------------------------------------
Moody's Investors Service has placed the Ba2 insurance financial
strength (IFS) rating of PrimeCare Medical Network, Inc. on review
for upgrade following the acquisition of the company by
UnitedHealth Group Inc.
Moody's insurance financial strength ratings are opinions of the
ability of insurance companies to pay punctually senior
policyholder claims and obligations.
Ratings Rationale:
PrimeCare and its parent company, North American Medical
Management, California, Inc. are subsidiaries under UnitedHealth's
Optum platform and serve existing UnitedHealth members. Moody's
stated that the review will focus on the implicit and explicit
support to be provided by UNH, the extent of the integration of
PrimeCare with Optum, and the strategic importance of PrimeCare to
UNH.
The rating agency added that NAMM develops and manages provider
networks, offering a range of services to assist physicians and
other providers in their managed care and business operations.
PrimeCare holds a limited Knox-Keene license in the state of
California and contracts with HMO's to provide healthcare services
for the HMO's enrollees. These licenses are granted pursuant to
the Knox-Keene Health Care Services Act of 1975. Under this
license the company is limited to contracting with health plans
and HMO's. It cannot enter into plan contracts directly with
employer groups or individuals. In addition to serving members of
UnitedHealth, PrimeCare also has contracts with Aetna, CIGNA,
Humana, and Health Net.
For 2012, PrimeCare reported total statutory revenue and net
income of $565 million and $25 million respectively. Total
enrollment as of December 31, 2012 was 204,557 members.
The principal methodology used in this rating was Moody's Rating
Methodology for U.S. Health Insurance Companies published in May
2011.
UnitedHealth Group Inc. (NYSE: UNH, A1 IFS, negative outlook) is
headquartered in Minnetonka, Minnesota. For the year ended 2012
the company reported revenues of $110.6 million. As of December
31, 2012 shareholders' equity was $31.2 billion and total medical
membership (excluding Part D Medicare membership) was
approximately 40.9 million.
QUALITY DISTRIBUTION: Reports $9.1 Million Net Income in Q1
-----------------------------------------------------------
Quality Distribution, Inc., reported net income of $9.14 million
on $229.42 million of total operating revenues for the three
months ended March 31, 2013, as compared with a net loss of $6.70
million on $191.91 million of total operating revenues for the
same period a year ago.
The Company's balance sheet at March 31, 2013, showed $510.52
million in total assets, $521.63 million in total lliabilities and
a $11.11 million total shareholders' deficit.
"Our first quarter results were in line with the expectations we
shared during our fourth quarter conference call," stated Gary
Enzor, chief executive officer. "As we anticipated, our Chemical
Logistics and Intermodal businesses posted results that were
sequentially better than the fourth quarter, reflecting solid
trends in both businesses. While our Energy Logistics business
generated slightly better revenues than we expected, its margins
were pressured due to adverse product mix issues, as well as
excess idle asset costs and equipment repositioning expenses. We
are aggressively addressing each of these issues while we further
develop and implement our actions plans to improve Energy's
results. Our leadership team remains optimistic about 2013 as we
intensely focus on improving overall operating results,
controlling our capital spending and delivering on our goal to
generate strong earnings and returns for our shareholders."
A copy of the press release is available for free at:
http://is.gd/GmI958
About Quality Distribution
Quality Distribution, LLC, and its parent holding company, Quality
Distribution, Inc., are headquartered in Tampa, Florida. The
company is a transporter of bulk liquid and dry bulk chemicals.
The company's 2010 revenues are approximately $686 million.
Apollo Management, L.P., owns roughly 30% of the common stock of
Quality Distribution, Inc.
Quality Distribution reported net income of $50.07 million for the
year ended Dec. 31, 2012, as compared with net income of $23.43
million in 2011.
Bankruptcy Warning
According to the Company's annual report for the period ended
Dec. 31, 2012, the Company had consolidated indebtedness and
capital lease obligations, including current maturities, of $418.8
million as of Dec. 31, 2012. The Company must make regular
payments under the ABL Facility and its capital leases and semi-
annual interest payments under its 2018 Notes.
The Company's 2018 Notes issued in the quarter ended Dec. 31,
2010, carry high fixed rates of interest. In addition, interest
on amounts borrowed under the Company's ABL Facility is variable
and will increase as market rates of interest increase. The
Company does not presently hedge against the risk of rising
interest rates. The Company's higher interest expense may reduce
its future profitability. The Company's future higher interest
expense and future redemption obligations could have other
important consequences with respect to the Company's ability to
manage its business successfully, including the following:
* it may make it more difficult for the Company to satisfy its
obligations for its indebtedness, and any failure to comply
with these obligations could result in an event of default;
* it will reduce the availability of the Company's cash flow to
fund working capital, capital expenditures and other business
activities;
* it increases the Company's vulnerability to adverse economic
and industry conditions;
* it limits the Company's flexibility in planning for, or
reacting to, changes in the Company's business and the
industry in which the Company operates;
* it may make the Company more vulnerable to further downturns
in its business or the economy; and
* it limits the Company's ability to exploit business
opportunities.
The ABL Facility matures August 2016. However, the maturity date
of the ABL Facility may be accelerated if the Company defaults on
its obligations.
"If the maturity of the ABL Facility and/or such other debt is
accelerated, we may not have sufficient cash on hand to repay the
ABL Facility and/or such other debt or be able to refinance the
ABL Facility and/or such other debt on acceptable terms, or at
all. The failure to repay or refinance the ABL Facility and/or
such other debt at maturity would have a material adverse effect
on our business and financial condition, would cause substantial
liquidity problems and may result in the bankruptcy of us and/or
our subsidiaries. Any actual or potential bankruptcy or liquidity
crisis may materially harm our relationships with our customers,
suppliers and independent affiliates."
RAHA LAKES: Plan Disclosures Need More Info on Funding
------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
directed Raha Lakes Enterprises, LLC, et al., to lodge, not later
than May 31, 2013, a declaration from Kayhan Shakib attesting to
his financial ability and willingness to make at least $383,071 in
capital contributions that will be necessary to fund the Debtors'
Plan of Reorganization, according to a notice filed in court.
If the declaration is not on file by May 31, the disclosure
statement will be denied and the case dismissed or converted as
the Court deems appropriate, the notice further stated.
The Bankruptcy Court held a hearing on April 30 to consider the
adequacy of the disclosure statement explaining the Debtors' Plan.
Payments under the Plan will be made from the proceeds of the
operation of the Debtors' business, which is primarily the
business of operating and managing the real property located at
912, 916 & 920 San Pedro Street, and 718 E. 9th Street, in Los
Angeles, California, and from the approximately $383,071 of "new
value" contributions from the Debtors' managing member, Kayhan
Shakib.
Mr. Shakib's contribution will be for new value to the Debtors and
in full satisfaction of San Pedro Investment, LLC's prepetition
and postpetition non-default claims for interest, fees, and costs.
The Debtors said they have received two offers to purchase the
Property, with the highest offer presently at $17 million.
SPI, secured creditor of the Debtors, objected to the Disclosure
Statement complaining that it falls short of providing "adequate
information" as required by Section 1125 of the Bankruptcy Code.
In their Plan, the Debtors propose to negatively amortize SPI's
claim, excluding default interest, attorney's fees and foreclosure
fees and costs, over 30 years with a 5.5% interest, payable in
monthly installments and due in three years, with the negatively
amortized amounts added to the principal. The Debtors also
propose to retain their ownership interest in the Property.
A redlined version of the Debtors' First Amended Plan dated
March 28, 2013, is available for free at:
http://bankrupt.com/misc/RAHALAKESds0328.pdf
About Raha Lakes
Raha Lakes Enterprises, LLC, filed a Chapter 11 petition (Bankr.
C.D. Cal. Case No. 12-43422) on Oct. 3, 2012, in Los Angeles.
Raha Lakes, a single-asset real estate company, estimated assets
of at least $10 million and debt of at least $1 million. The
company's principal asset is at 900 South San Pedro Street in Los
Angeles. Raha Lakes estimated $10 million to $50 million in
assets, and $1 million to $10 million in debts. The petition was
signed by Kayhan Shakib, managing member.
Mehr in Los Angeles Enterprises, LLC, filed a bare-bones Chapter
11 petition (Bankr. C.D. Cal. Case No. 12-43589) on Oct. 4,
2012, estimating assets of at least $10 million and liabilities of
at least $1 million. The petition was signed by Yadollah Shakib,
managing member.
Judge Ernest M. Robles presides over the cases. The Debtors are
represented by Michael S. Kogan, Esq., at Kogan Law Firm APC.
John Choi, Esq., at Kim Park Choi, in Los Angeles, represents
secured creditor San Pedro Investment, LLC, as counsel.
REGIONALCARE HOSPITAL: Loan Increase No Impact on Moody's B3 CFR
----------------------------------------------------------------
Moody's Investors Service commented that RegionalCare Hospital
Partners, Inc.'s increase in the amount of term loans outstanding
is a credit negative as it will result in an increase in the
company's already high financial leverage. However, there is no
change to RCHP's ratings, including its B3 Corporate Family Rating
and B3-PD Probability of Default Rating.
RegionalCare Hospital Partners, Inc. operates eight hospital
facilities in seven states and recognized revenue of $571 million
for the year ended December 31, 2012 after considering the
provision for doubtful accounts.
RESIDENTIAL CAPITAL: Chief Executive Tom Marano Steps Down
----------------------------------------------------------
Thomas Marano has resigned as CEO of Residential Capital, or
ResCap. Marano joined ResCap in August 2008. ResCap, then the
fifth-largest servicer of residential mortgage loans in the United
States and a leading mortgage loan originator, predictably
suffered during the financial crisis. From 2008 to 2011, Marano
implemented a significant restructuring of ResCap's servicing and
origination business, which required the disposition of various
non-strategic foreign and domestic business lines and portfolios.
Marano established new underwriting criteria and introduced new
servicing protocols designed to strengthen the company's domestic
origination and servicing business. During his tenure, ResCap was
a leader in facilitating mortgage modifications for troubled
borrowers. Nearly 1 million homeowners received mortgage
modifications, and ResCap originated approximately $200 billion in
new residential mortgage loans.
Like many others in the mortgage industry, ResCap faced
considerable regulatory and litigation exposures. In 2012, parent
company Ally withdrew its support for ResCap due to, among other
things, rep-and-warranty liability concerns, which liabilities
were created during the 2005 through 2007 origination years. In
May 2012, after having pursued various strategic alternatives,
ResCap filed for bankruptcy. Mr. Marano guided ResCap through
successful bankruptcy asset sales to Ocwen Loan Servicing, LLC,
Walter Management Investment Corp. and Berkshire Hathaway Inc.
These asset sales generated proceeds in excess of $4 billion
dollars, and preserved 3,750 of 3,900 U.S.-based jobs. Mr. Marano
has agreed to stay on as an outside director of ResCap in order to
facilitate a smooth transition for the bankruptcy estate, while he
pursues other interests. The ResCap estate also will benefit from
having Tammy Hamzehpour, former general counsel, working closely
going forward on restructuring and wind down matters with Chief
Restructuring Officer Lewis Kruger. Mt. Hamzehpour will function
as ResCap's Chief Business Officer.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RG STEEL: GEM Wants Sale Order Revised to Remove, Sell Mill Steel
-----------------------------------------------------------------
Grand East Metals is seeking a revision to Judge Kevin Carey's
previous order authorizing the sale of RG Steel LLC's Sparrows
Point assets.
GEM proposed to revise the sale order dated Sept. 18, 2012, to
afford the company enough time to remove or sell the 15,000 tons
of mill steel it owns, and which has been stored at RG Steel's
Sparrows Point facility in Baltimore, Maryland. The mill steel is
reportedly worth $1.5 million.
A court hearing is scheduled for May 22. Objections are due by
May 15.
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 owned 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. 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 bankruptcy 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.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's 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. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
ROTECH HEALTHCARE: Shareholders Defend Creation of Equity Panel
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that shareholders of Rotech Healthcare Inc. defended the
decision of the U.S. Trustee to appoint an official equity
committee and will urge the bankruptcy judge at a hearing May 7
to reject the company's motion to disband the panel appointed
April 25.
At the hearing, the equity committee will be opposing final
approval of $30 million in financing to support the
reorganization.
In her papers last week defending the creation of a shareholders'
committee, the U.S. Trustee argued that the proposed distribution
to stockholders by itself was enough reason for an official
committee.
The report notes that the U.S. Trustee and the committee both take
the position that the Delaware bankruptcy judge can disband the
committee only if he concludes the U.S. Trustee abused her
discretion. Looking at the facts, the newly formed committee said
its preliminary view of the financials suggests that Rotech will
have an "implied enterprise value" ranging between $684 million
and $799 million, or as much as twice the value ascribed by the
company's experts.
The equity committee, the report discloses, points out how there
wasn't any effort before bankruptcy to market Rotech, so the value
hasn't been tested in the marketplace. Consequently, the
committee contends the court shouldn't accept the company's
contention that the business "is insolvent by between $128 million
and $188 million."
Silver Point Finance LLC, a lender on an existing term loan,
agreed to provide a $30 million secured loan for the bankruptcy.
The equity committee says that approving the loan May 7 would be a
"finely orchestrated final step in executing an expedited debt-to-
equity conversion" for the benefit of Silver Point and other
second-lien noteholders. The shareholders say that deadlines in
the loan require such quick action that working out alternative
plans is impossible.
About Rotech Healthcare
Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI)
-- http://www.rotech.com/-- provides home medical equipment and
related products and services in the United States, with a
comprehensive offering of respiratory therapy and durable home
medical equipment and related services. The company provides
equipment and services in 48 states through approximately 500
operating centers located primarily in non-urban markets.
The Company reported a net loss of $14.76 million in 2011, a net
loss of $4.20 million in 2010, and a net loss of $21.08 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed
$255.76 million in total assets, $601.98 million in total
liabilities, and a $346.22 million total stockholders' deficiency.
On April 8, 2013, Rotech Healthcare and 114 subsidiary companies
filed petitions seeking relief under chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Lead Case No. 13-10741) to implement a pre-
arranged plan negotiated with secured lenders.
Attorneys at Proskauer Rose LLP, and Young, Conaway, Stargatt &
Taylor serve as counsel to the Debtors; Foley & Lardner LLP is the
healthcare regulatory counsel; Akin Gump Strauss Hauer & Feld LLP
is the special healthcare regulatory counsel; Barclays Capital
Inc. is the financial advisor; Alix Partners, LLP is the
restructuring advisor; and Epiq Bankruptcy Solutions LLC is the
claims agent.
Prepetition term loan lender and DIP lender Silver Point Capital
and other consenting noteholders are represented by Wachtell,
Lipton, Rosen & Katz, and Richards Layton & Finger PA.
The U.S. Trustee at the end of April appointed an official
committee of equity holders. Members include Alden Global
Recovery Master Fund LP, Varana Capital Master LP, Wynnefield
Partners Small Cap Value LP I, Bastogne Capital Partners, LP, and
Kenneth S. Grossman P.C. Pension Plan.
A hearing is scheduled for May 16 on approval of disclosure
materials explaining the plan. The plan is supported by holders
of a majority of the first- and second-lien secured notes. The
$290 million in 10.5 percent second-lien notes are to be exchanged
for the new equity. Trade suppliers are to be paid in full, if
they agree to continue providing credit. The existing $23.5
million term loan would be paid in full, and the $230 million in
10.75 percent first-lien notes will be amended.
SAN BERNARDINO, CA: Residents Launch Council Recall
---------------------------------------------------
Tim Reid, writing for Reuters, reported that up in arms against
the leadership it blames for San Bernardino's bankruptcy, a group
of business people and residents on Thursday launched a campaign
to recall the California city's council, mayor and city attorney.
According to the Reuters report, the group, looking for a "clean
sweep" inside crisis-hit San Bernardino, presented its initiative
on the steps of City Hall before a crowd of residents and local
media.
Reuters related that San Bernardino passed a new budget last week
that calls for it to resume payments to Calpers in July -- after a
year of non-payments -- but not to many other creditors, including
holders and insurers of its $50 million in pension bonds.
The Stockton bankruptcy has progressed more quickly and the city
appears more organized to deal with proceedings than does San
Bernardino, where the case has become bogged down in procedural
issues involving financial evidence, the report said. The city
and its creditors are due to meet again in court next week.
The group of San Bernardino business people and residents seeking
to eject the city's current leadership needs to collect enough
signatures by July 30, and find viable candidates, to challenge
the seven council members, the mayor and city attorney in
November's election, the report said.
The group, San Bernardino Residents for Responsible Government, is
led by local businessmen Scott Beard and Tom Brickley, the report
added. Beard says there are "10 core members" of the group and
they have been planning the recall drive for nearly a year.
"We are very frustrated with the performance of our council and we
have to take some action," Beard said in a telephone interview
with Reuters. "We just feel the only way to correct that problem
is to change the entire leadership."
Beard told Reuters that the group already had four people willing
to stand as council candidates, but he declined to provide their
names. He said the group is talking to others so the entire
council will be challenged in November.
Recall elections are difficult to execute, Reuters added. In San
Bernardino's case, the group must collect signatures of 25 percent
of registered voters in each of the city's seven wards to bring a
recall election against each council member, and 15 percent of the
city's registered voters to challenge the mayor and city attorney.
If the group obtains enough signatures in each council district
and across the city, it will force all seven council members, plus
the mayor and city attorney, onto November's ballot, with a
challenger for each, the report added. Otherwise, only three of
the council's members would be on the ballot in November.
That process could cost at least $200,000, the city told Reuters.
Beard says the group has already raised $80,000 and has pledges
for at least $100,000 more. Beard said it was worth spending the
money, and replacing the current council, which has been riven by
infighting and dissent. A new one could "work together, create
jobs, protect residents and come up with a viable long-term plan
for the city," he said.
About San Bernardino, Calif.
San Bernardino, California, filed an emergency petition for
municipal bankruptcy under Chapter 9 of the U.S. Bankruptcy Code
(Bankr. C.D. Cal. Case No. 12-28006) on Aug. 1, 2012. San
Bernardino, a city of about 210,000 residents roughly 65 miles
(104 km) east of Los Angeles, estimated assets and debts of more
than $1 billion in the bare-bones bankruptcy petition.
The city council voted on July 10, 2012, to file for bankruptcy.
The move lets San Bernardino bypass state-required mediation with
creditors and proceed directly to U.S. Bankruptcy Court.
The city is represented that Paul R. Glassman, Esq., at Stradling
Yocca Carlson & Rauth.
San Bernardino joined two other California cities in bankruptcy:
Stockton, an agricultural center of 292,000 east of San Francisco,
and Mammoth Lakes, a mountain resort town of 8,200 south of
Yosemite National Park.
SERRON INVESTMENTS: Case Summary & 2 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Serron Investments, Inc.
7318 Topanga Canyon Boulevard
Canoga Park, CA 91303
Bankruptcy Case No.: 13-13024
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Central District of California (San Fernando Valley)
Debtor's Counsel: Moises S. Bardavid, Esq.
16133 Ventura Boulevard, 7th Floor
Encino, CA 91436
Tel: (818) 377-7454
Fax: (818) 377-7455
E-mail: mbardavid@hotmail.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 unsecured creditors filed
with the petition is available for free at:
http://bankrupt.com/misc/cacb13-13024.pdf
The petition was signed by Oscar Broederlow, secretary.
SHILO INN: Updated Case Summary & Creditors' Lists
--------------------------------------------------
Debtor: Shilo Inn, Twin Falls, LLC
11600 SW Shilo Lane
Portland, OR 97225-0000
Bankruptcy Case No.: 13-21601
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Central District of California (Los Angeles)
Judge: Richard M. Neiter
Debtors' Counsel: David B. Golubchik, Esq.
LEVENE NEALE BENDER RANKIN & BRILL, LLP
10250 Constellation Boulevard, Suite 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
E-mail: dbg@lnbrb.com
Lead Debtor's
Estimated Assets: $10,000,001 to $50,000,000
Lead Debtor's
Estimated Debts: $1,000,001 to $10,000,000
Affiliates that simultaneously filed Chapter 11 petitions on May
1, 2013:
Debtor Case No.
------ --------
Shilo Inn, Boise Airport, LLC 13-21603
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
Shilo Inn, Nampa Blvd, LLC 13-21604
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
Shilo Inn, Newberg, LLC 13-21605
Shilo Inn, Seaside East, LLC 13-21606
Shilo Inn, Moses Lake, Inc. 13-21607
Shilo Inn, Rose Garden, LLC 13-21608
The petitions were signed by Wes Rabom, general counsel and
authorized agent.
Affiliates that previously sought Chapter 11 protection:
Entity Case No. Petition Date
------ -------- -------------
JDCK, LLC 12-26468 05/09/13
LSSR, LLC 12-24557 04/25/12
Troy Lodge, LLC 12-26469 05/09/13
A. Shilo Inn, Twin Falls' List of Its Eight Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Clark Signs EMC, LLC -- $10,200
31321 Signs Drive
Deer Island, OR 97051
Idaho Power, Inc. -- $7,625
P.O. Box 34966
Seattle, WA 98124
Lodging Supply Company -- $6,760
8852 SW Waverly A/R
Portland, OR 97224
Intermountain Gas -- $4,818
Clark Signs -- $3,044
Lodgenet Entertainment Corp. ?- $2,198
Centurylink -- $651
Centurylink -- $92
B. A copy of Shilo Inn, Boise Airport's list of its 10 largest
unsecured creditors filed with the petition is available for free
at http://bankrupt.com/misc/cacb13-21603.pdf
B. A copy of Shilo Inn, Nampa Blvd's list of its nine largest
unsecured creditors filed with the petition is available for free
at http://bankrupt.com/misc/cacb13-21604.pdf
SIRIUS XM: $500-Mil. Debt Increase No Impact on Moody's Ratings
---------------------------------------------------------------
Moody's Investors Service said that there is no change in the B1
instrument ratings assigned to Sirius XM Radio Inc.'s senior notes
that were upsized to $1 billion from $500 million.
Moody's also said that the Ba3 Corporate Family Rating (CFR), Ba3-
PD Probability of Default Rating as well as B1 instrument ratings
on the 8.75% senior notes, 7.625% senior notes, and the 5.25%
senior notes remain unchanged. The company plans to use the
incremental net proceeds from the upsized senior notes for general
corporate purposes, including partial refinancing of existing
senior notes. In addition, Moody's said that the rating outlook
remains stable.
The following is a summary for Moody's ratings for Sirius:
Issuer: Sirius XM Radio Inc.
Corporate Family Rating: Ba3
Probability of Default Rating: Ba3-PD
NEW $500 million of 4.25% sr notes due 2020: B1, LGD4 -- 60%
NEW $500 million of 4.625% sr notes due 2023: B1, LGD4 -- 60%
$800 million of 8.75% sr notes due 2015: B1, LGD4 -- 60%
$700 million of 7.625% sr notes due 2018: B1, LGD4 -- 60%
$400 million of 5.25% sr notes due 2022: B1, LGD4 -- 60%
Speculative Grade Liquidity Rating: SGL -- 1
Outlook:
Issuer: Sirius XM Radio Inc.
Outlook is Stable
Ratings Rationale:
The company's Ba3 corporate family rating incorporates the
increase in debt balances by $500 million due to the upsized
senior notes offering to $1.0 billion. The incremental debt
elevates total leverage to the 3.75x upper threshold for the CFR
(including Moody's standard adjustments), but remains under 3.0x
net of cash. Moody's expects some proceeds from the upsized
offering will be used to refinance existing senior notes reducing
the gross leverage to less than the 3.75x.
The principal methodology used in this rating was Global Broadcast
and Advertising Related Industry 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.
Sirius XM Radio Inc., headquartered in New York, NY, provides
satellite radio services in the United States and Canada. The
company creates and broadcasts commercial-free music; premier
sports talk and live events; comedy; news; exclusive talk and
entertainment; and comprehensive Latin music, sports and talk
programming. Sirius XM services are available in vehicles from
every major car company in the U.S., and programming is also
available online as well as through applications for smartphones
and other connected devices. The company holds a 37.9% interest in
Sirius XM Canada which has more than 2 million subscribers. Sirius
is publicly traded and a controlled company of Liberty Media
Corporation which owns over 50% of common shares and controls a
majority of the board of directors. Sirius reported 24.4 million
subscribers at the end of March 2013 and generated revenue of $3.5
billion for the trailing 12 months ended March 31, 2013.
SIRIUS XM: S&P Assigns 'BB' Rating to $500MM Notes Due 2023
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned New York City-based
satellite radio company Sirius XM Radio Inc.'s issuance of
$500 million 4.625% senior notes due 2023 an issue-level rating of
'BB', with a recovery rating of '3'. The '3' recovery rating
indicates S&P's expectation of meaningful (50% to 70%) recovery in
the event of a payment default. Sirius plans to use the net
proceeds for general corporate purposes, which includes share
repurchases and, over time, the potential repayment of higher
coupon debt. Cash balances were roughly $1 billion at March 31,
2013, pro forma for the $150 million repayment of revolving credit
facility borrowings.
S&P's existing ratings on Sirius XM Radio, including the 'BB'
corporate credit rating, are unchanged following yesterday's late
afternoon increase in the size of the debt issuance to two
tranches totaling $1 billion, from the $500 million 4.25% senior
notes due 2020. Pro forma leverage remains below S&P's target for
the company at this rating. The rating outlook is stable. S&P do
not expect to raise the rating in the intermediate term, given the
shift to a more shareholder-favoring financial policy.
The rating on Sirius XM Radio incorporates S&P's expectation that
leverage will not increase above our 4.5x target despite moves to
boost shareholder returns, because of its good operating outlook
and growing discretionary cash flow. S&P assess Sirius' business
risk profile as "fair," reflecting its stable churn despite modest
price increases, steady stream of new subscribers, dependence on
U.S. new auto sales and consumer discretionary spending for
growth, and its intermediate-term vulnerability to competition
from alternative media. S&P views Sirius XM's financial risk as
"significant" because of its expectation of rising debt leverage
following Liberty Media Corp.'s January 2013 majority ownership
stake.
In December 2012, the company paid a $327 million special dividend
and authorized a $2 billion share repurchase program. The company
has purchased nearly $700 million under this program through the
end of April. Pro forma for the debt issuance, lease-adjusted
gross debt-to-EBITDA increased to 3.7x as of March 31, 2013, from
2.7x. It's S&P's view that debt-to-EBITDA will not increase above
its 4.5x target in the intermediate term.
Ratings List
Sirius XM Radio Inc.
Corporate credit rating BB/Stable/--
New Ratings
Sirius XM Radio Inc.
Senior unsecured
$500 mil. 4.625% notes due 2023 BB
Recovery rating 3
SIX FLAGS: Moody's Affirms 'B1' Corp. Family Rating
---------------------------------------------------
Moody's Investors Service downgraded Six Flags Entertainment
Corporation's speculative grade liquidity rating to SGL-4 from
SGL-2 and affirmed the company's B1 Corporate Family Rating.
The SGL rating reduction reflects Six Flags' utilization of excess
cash from its $800 million bond offering in December for share
repurchases as anticipated. The note proceeds temporarily
increased the amount of cash Six Flags had available to cover
partnership put exercises pending execution of the planned share
repurchases. Six Flags' approximate $110 million of cash as of
March 31st (pro forma for the use of roughly $30 million for share
repurchases subsequent to quarter end as announced on the
company's first quarter earnings call) and $181 million of unused
capacity under its $200 million revolver (factoring in letters of
credit) would not be sufficient to cover a full exercise of the
approximate $358 million of partnership puts in 2014. This assumes
Six Flags' $0.90 per share quarterly dividend will consume the
bulk of its cash flow generation over the next year and normal
off-season cash flow consumption occurs prior to the start of the
2014 operating season. The rating outlook remains stable.
Moody's assumes a full put exercise in its liquidity analysis,
although actual put exercises have been less than $10 million
annually (except for $66 million in 2009) since the put structure
was established as part of Six Flags' 1998 leveraged buyout from
Time Warner. This is a level that is comfortably manageable within
Six Flags existing cash and unused revolver capacity. The timing
of the put option is crucial as they are exercisable annually from
March 31st through late April and Six Flags must fund any
exercises by May 15th. This is in the midst of Six Flags' peak
seasonal cash needs as the majority of its cash flow is generated
during the height of its operating season from April-October.
Moody's previously indicated in its December 5th press release
that Six Flags' liquidity rating would likely revert to SGL-4 once
the company deployed the bond offering proceeds. Moody's affirmed
the B1 CFR and Six Flags' other ratings because utilization of the
cash for share repurchases was assumed in those ratings. Moody's
also updated the loss given default estimates to reflect the
current debt mix.
Downgrades:
Issuer: Six Flags Entertainment Corporation
Speculative Grade Liquidity Rating, Downgraded to SGL-4 from
SGL-2
Affirmations:
Issuer: Six Flags Entertainment Corporation
Corporate Family Rating, Affirmed B1
Probability of Default Rating, Affirmed B1-PD
Senior Unsecured Regular Bond/Debenture maturing Jan 15, 2021,
Affirmed B3, LGD5 - 74% (from LGD5 - 79%)
Issuer: Six Flags Theme Parks Inc.
Senior Secured Bank Credit Facility (Revolver) due Dec 20,
2016, Affirmed Ba2, LGD2 - 19% (from LGD2 - 25%)
Senior Secured Bank Credit Facility (Term Loan) due Dec 20,
2018, Affirmed Ba2, LGD2 - 19% (from LGD2 - 25%)
Ratings Rationale:
Six Flags' B1 CFR reflects the sizable attendance and revenue
generated from the geographically diversified regional amusement
park portfolio, vulnerability to cyclical discretionary consumer
spending, high leverage, liquidity and funding risks associated
with minority holders' annual right to put their share of
partnership parks to the company, and event risk relating to
shareholder distributions and ownership transitions. The amusement
park industry is mature and operators must compete with a wide
variety of leisure and entertainment activities to generate
consumer interest, with attendance growth in the low single digit
range expected over the next 3-5 years. The new management team
installed in conjunction with the company's emergence from
bankruptcy in April 2010 has implemented significant operational
improvements to drive meaningful earnings growth. Moody's believes
ongoing operational initiatives including yield management and an
emphasis on season pass sales will continue to grow revenue and
earnings over the intermediate term, although there is moderate
downside if the economy were to weaken.
The stable rating outlook reflects Moody's view that Six Flags
will take advantage of the restricted payments flexibility in its
credit facility to devote cash flow generation to dividends and
share repurchases with limited debt reduction over the next 12-18
months. Moody's expects debt-to-EBITDA leverage (5.0x LTM 3/31/13
incorporating Moody's standard adjustments) to fall to a mid 4x
range in 2013 through earnings growth including a reduction in
stock compensation. Continued operational improvement is expected
absent significant economic headwinds.
A good liquidity position including sufficient cash, projected
free cash flow and committed financing to fully cover potential
partnership park put exercises would be necessary for an upgrade.
Stable to improving operating performance and margins, management
of shareholder distributions within excess cash and free cash
flow, and a conservative leverage profile could position the
company for an upgrade. Increased financial capacity to manage
event risks such as debt-to-EBITDA leverage in a low 4x range or
lower and strong CFO less capital spending-to-debt would be
necessary for an upgrade.
Downward rating pressure could result if acquisitions, cash
distributions to shareholders, ownership transitions, or declines
in attendance and earnings driven by competition or a prolonged
economic downturn lead to debt-to-EBITDA above 5.75x or CFO less
capital spending-to-debt of less than 4%. Ratings could also be
pressured if liquidity weakens - including if concerns arise
regarding the company's ability to meet partnership put
obligations -- or the company's financial policies become more
aggressive.
Six Flags' ratings were assigned by evaluating factors that
Moody's considers relevant to the credit profile of the issuer,
such as the company's (i) business risk and competitive position
compared with others within the industry; (ii) capital structure
and financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside Six Flags' core industry and
believes Six Flags' ratings are comparable to those of other
issuers with similar credit risk. Methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Six Flags, headquartered in Grand Prairie, TX, is a regional theme
park company that operates 18 North American parks. The park
portfolio includes 14 wholly-owned facilities (including parks
near New York City, Chicago and Los Angeles) and three
consolidated partnership parks - Six Flags over Texas (SFOT), Six
Flags over Georgia (SFOG), and White Water Atlanta - as well as
Six Flags Great Escape Lodge, which is a consolidated joint
venture. Six Flags currently owns 53.0% of SFOT and approximately
30.5% of SFOG/White Water Atlanta. Revenue including full
consolidation of the partnership parks and joint venture was
approximately $1.09 billion for the LTM period ended 3/31/13.
SPRING PLAN: Files Plan to Implement Settlement with Cantor
-----------------------------------------------------------
Sand Spring Capital III, LLC, et al., propose a Joint Plan of
Reorganization that will reconstitute each debtor as a reorganized
fund. On the effective date of the Plan, all unliquidated assets
of the Debtors will be assets of each of the reorganized fund.
The Plan also contemplates the implementation of the settlement
agreement, dated March 7, 2013, between the Debtors and Cantor
Fitzgerald & Co. The Debtors or Reorganized Funds will provide to
Canter written notice of when the Cantor Chapter 11 Settlement
Effective Date is schedule to occur, and
Secured Claims will be paid in respect of the Allowed Secured
Claim (i) the return of the collateral securing that Allowed
Secured Claim, (ii) the reinstatement of that Allowed Secured
Claim, (iii) the payment of the Allowed Secured Claim in full in
cash, or (iv) other treatment that will be agreed between the
Holder of the Allowed Secured Claim and the Debtors.
Allowed General Unsecured Claim will be paid (i) the full amount
of the Claim in Cash or (ii) a lesser amount as the Holder of an
Allowed General Unsecured Claim and the Debtors might otherwise
agree.
Each holder of an Allowed Independent Fiduciary Indemnification
Claim will receive a full and complete release from all claims and
causes of action that any of the Debtors or the investors may
have. All Indemnification Claims asserted by Commonwealth have
been waived. All Interest Holder General Unsecured Claims will be
disallowed and not entitled to vote on the Plan.
A full-text copy of the Plan dated April 25, 2013, is available
for free at http://bankrupt.com/misc/SANDSPRINGplan0425.pdf
About Sand Spring
Nine funds advised by Commonwealth Advisors Inc. of Baton Rouge,
Louisiana, sought Chapter 11 protection on Oct. 25, 2011, after
failing to work out a reorganization plan acceptable to all
investors. Lead Debtor is Sand Spring Capital III, LLC (Bankr. D.
Del. Case No. 11-13393).
Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor,
Wilmington, Delaware serves as counsel to the Debtors. Epiq
Bankruptcy Solutions LLC serves as claims and notice agent.
The funds were formed from 2005 to 2007 under Walter Morales,
president and chief investment manager, and attracted 456
investors, according to filings in U.S. Bankruptcy Court in
Wilmington, Delaware. Last year, investors filed class-action
and derivative suits alleging mismanagement, misrepresentation,
and breach of fiduciary duty.
According to Bloomberg News, the U.S. Securities and Exchange
Commission initiated a formal investigation in July 2009. The
funds were unable or unwilling to satisfy investors' redemption
demands, which would have required liquidation of "their
holdings in an illiquid market and at depressed prices."
The funds, Commonwealth and Morales negotiated a prepackaged
Chapter 11 plan, which was accepted by all classes of creditors
except one. Because third-party contributions required unanimous
approval, the funds said they filed in Chapter 11 so they could
have "further discussions with their investors with the oversight
of this court."
STANDARD STEEL: S&P Withdraws 'BB-' Corporate Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services withdrew all its ratings on
U.S.-based railcar and locomotive wheel and axle manufacturer
Standard Steel LLC, including its 'BB-' corporate credit rating on
the company, and the 'BB-' issue-level rating and '3' recovery
rating on Standard Steel's $140 million 12% senior secured notes
due 2015, which were redeemed in full. S&P withdrew the ratings
at the request of the company. The 'BB-' corporate credit rating
reflected S&P's assessment of the company's "weak" business risk
profile and its "aggressive" financial risk profile. The outlook
was stable at the time of the withdrawal.
STRATUM HOLDINGS: Incurs $92,000 Net Loss in 1st Quarter
--------------------------------------------------------
Stratum Holdings, Inc., filed on May 1, 2013, its quarterly report
on Form 10-Q, reporting $91,983 on $765,300 of total revenues for
the three months ended March 31, 2013, compared with a net loss of
$318,044 on $705,560 of total revenues for the same period last
year.
Workover expenses for the three months ended March 31, 2013, were
$43,000 versus $260,000 for the three months ended March 31, 2012,
representing workovers on CYMRI's and Triumph's oil and gas
properties. This decrease was largely experienced in CYMRI's
Burnell Field.
The Company's balance sheet at March 31, 2013, showed $7.6 million
in total assets, $5.9 million in total liabilities, and
stockholders' equity of $1.7 million.
"The Company has reported net losses from continuing operations in
the last two years and has a substantial working capital deficit
as of March 31, 2013. These factors, among others, indicate that
the Company may be unable to continue as a going concern for a
reasonable period of time. should the Company be unable to
continue as a going concern," the Company said.
A copy of the Form 10-Q is available at http://is.gd/XiMd3t
Houston, Texas-based Stratum Holdings, Inc., is a holding company
whose operations are presently focused on the domestic Exploration
& Production business. In that business, the Company's wholly-
owned subsidiaries, CYMRI, L.L.C., and Triumph Energy, Inc.,
maintain working interests in approximately 45 to 50 producing oil
and gas wells in Texas and Louisiana, with net production of
approximately 700 MCF equivalent per day.
In late 2012, Stratum formed a new wholly-owned subsidiary,
Deployed Energy, Inc., to enter the domestic Energy Services
business, primarily in Texas. As of March 31, 2013, this new
subsidiary was still in the formative stages and had not commenced
revenue producing operations. In conjunction with the startup of
Deployed Energy, Stratum says it may consider divesting oil and
gas properties in its Exploration & Production business.
* * *
As reported in the TCR on March 26, 2013, MaloneBailey, LLP, in
Houston, Texas, expressed substantial doubt about Stratum
Holdings' ability to continue as a going concern, citing the
Company's losses from continuing operations and working
capital deficit.
SUBURBAN WEST: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Suburban West Properties, LLC
dba Baymont Inn & Suites
2135 City Gate Lane
Naperville, IL 60563
Bankruptcy Case No.: 13-18697
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Timothy A. Barnes
Debtor's Counsel: Debra J. Vorhies Levine, Esq.
DVL LAW OFFICES, LLC
53 W. Jackson Boulevard, Suite 1001
Chicago, IL 60604
Tel: (312) 880-0224
Fax: (312) 588-0785
E-mail: debra.levine@dvllawoffices.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/ilnb13-18697.pdf
The petition was signed by Kenneth Moore, managing partner.
SUNSTONE COMPONENTS: Accedes to Bankruptcy to Sell Business
-----------------------------------------------------------
Sunstone Components Group on May 3 disclosed that it has signed a
Letter of Intent (LOI) with Pancon Corporation to sell
substantially all of the Company's assets.
Headquartered in Stoughton, Mass., Pancon Corporation manufactures
custom and standard connectors that are used in power and signal
applications and multilayer polymer capacitors across varied
industries, including automotive. Pancon also has the strong
backing of its private equity owner, Milestone Partners.
To facilitate the sale and establish a process for the receipt of
higher and better bids, the Company has consented to the
involuntary Chapter 11 petitions filed against it on April 5,
2013. Sunstone Components Group is expected to complete the sale
and emerge from Chapter 11 in approximately 75 days.
"This transaction is a positive development for our company, our
customers and our employees," said Sunstone Components Group
Chairman and CEO Brad Adams. "We are pleased to have attracted a
strong strategic partner for our business with the resources
necessary to secure a strong future for our company.
"After careful consideration, we have decided to consent to the
involuntary Chapter 11 proceedings. The Chapter 11 process is
essentially a tool that will allow us to complete the sale swiftly
and ensure a smooth transition."
The Company also announced that in addition to having continuing
availability under its existing facility with Comerica, it has
obtained commitments for approximately $220,000 in debtor-in-
possession (DIP) financing, pending Court approval. As a result,
the Company has the availability of approximately $2.2 million to
meet its ongoing obligations to customers, suppliers and employees
during the brief Chapter 11 and sale process.
Customers should see no changes while the company completes the
sale of its business. Sunstone Components Group does not intend
to reduce its workforce as a result of the filing, and employees
will continue to work their usual schedules and receive normal
compensation and benefits, pending routine Court approval.
"Throughout the sale process and beyond, our daily operations will
continue without interruption," Mr. Adams said. "We will continue
to manufacture and deliver the high-quality, mission-critical
components our customers require. It will be business as usual
while we complete the sale."
On May 2, 2013, the Company consented to involuntary Chapter 11
petitions filed against it in the U.S. Bankruptcy Court for the
Central District of California in Riverside.
About Sunstone Components Group
Headquartered in Temecula, California, Sunstone Components Group
is a provider of precision metal stamping and insert injection
moldings
Snowbird Capital Mezzanine Fund, a subordinate secured lender owed
$6.7 million by Sunstone Components Group, Inc., filed an
involuntary Chapter 11 bankruptcy petition for Sunstone on April
5, 2013 (Bankr. C.D. Cal. Case No. 13-16232). The Debtor is
represented by attorneys at Landau Gottfried & Berger, LLP. The
petitioner tapped Arent Fox, LLP as counsel.
Comerica Bank, owed about $5.1 million, is the senior secured
lender. The bank is providing an additional $220,000 loan for the
bankruptcy.
THQ INC: President's Bonus Opposed by U.S. Trustee
--------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that former video-game developer THQ Inc. will face
opposition from the U.S. Trustee at a May 13 hearing for approval
of bonuses for company President Edward Kaufman.
According to the report, the U.S. Trustee says THQ hasn't shown
that the bonuses aren't retention bonuses banned by Congress for
top executives of bankrupt companies. If the court goes along,
Kaufman will receive a $100,000 bonus if the liquidating Chapter
11 plan, filed April 18, is confirmed by Aug. 31. He receives
another $100,000 if the distribution to unsecured creditors is
$60 million, plus 1 percent of distributions over $60 million.
The report notes that the Justice Department's bankruptcy watchdog
contends THQ hasn't shown the targets are "difficult" to reach.
She said the plan "does not appear complicated and it is unlikely
to have high hurdles to confirmation."
About THQ Inc.
THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide
developer and publisher of interactive entertainment software.
The Company develops its products for all popular game systems,
personal computers, wireless devices and the Internet.
Headquartered in Los Angeles County, California, THQ sells product
through its network of offices located throughout North America
and Europe.
THQ Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 12-13398) on Dec. 19, 2012.
Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn
& Crutcher LLP serve as counsel to the Debtors. FTI Consulting
and Centerview Partners LLC are the financial advisors. Kurtzman
Carson Consultants is the claims and notice agent.
Before bankruptcy, Clearlake signed a contract to buy Agoura THQ
for a price said to be worth $60 million. After a 22-hour auction
with 10 bidders, the top offers brought a combined $72 million
from several buyers who will split up the company. Judge Walrath
approved the sales in January. Some of the assets didn't sell,
including properties the company said could be worth about $29
million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed five
persons to serve in the Official Committee of Unsecured Creditors.
The Committee tapped Houlihan Lokey Capital as its financial
advisor and investment banker, Landis Rath & Cobb as co-counsel
and Andrews Kurth as counsel.
The disclosure statement for THQ's plan says unsecured creditors
can expect to recover as little as 19.9 percent or as much as 51.9
percent on claims totaling $143 million to $184 million.
TIGAMAN INC: Case Summary & 2 Unsecured Creditors
-------------------------------------------------
Debtor: Tigaman, Inc.
dba The Cat Clinic of Roswell
1002 Canton Street
Roswell, GA 30075
Bankruptcy Case No.: 13-59458
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Northern District of Georgia (Atlanta)
Judge: Barbara Ellis-Monro
Debtors' Counsel: Ian M. Falcone, Esq.
THE FALCONE LAW FIRM, P.C.
363 Lawrence Street
Marietta, GA 30060
Tel: (770) 426-9359
E-mail: attorneys@falconefirm.com
Scheduled Assets: $65,000
Scheduled Liabilities: $1,834,718
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
Tomcat Properties, LLC 13-59459
Assets: $574
Debts: $1,793,986
The petitions were signed by Michael S. Ray, president.
A. A copy of Tigaman's list of its two largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ganb13-59458.pdf
B. A copy of Tomcat Properties' list of its two largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/ganb13-59459.pdf
TIMEGATE STUDIOS: Case Summary & 18 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: TimeGate Studios, Inc.
14140 Southwest Freeway, Suite 200
Sugar Land, TX 77478
Bankruptcy Case No.: 13-32527
Chapter 11 Petition Date: May 1, 2013
Court: U.S. Bankruptcy Court
Southern District of Texas (Houston)
Judge: Jeff Bohm
Debtor's Counsel: Karl Daniel Burrer, Esq.
HAYNES & BOONE, LLP
1221 McKinney, Suite 2100
Houston, TX 77010
Tel: (713) 547-2231
Fax: (713) 236-5402
E-mail: karl.burrer@haynesboone.com
Debtor's
Financial
Advisor: CONWAY MACKENZIE, INC.
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 18 largest unsecured creditors
is available for free at http://bankrupt.com/misc/txsb13-32527.pdf
The petition was signed by John T. Young, Jr., chief restructuring
officer.
TOMSTEN INC: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Tomsten, Inc.
dba Archiver's
dba Archivers Online
dba Archivers Memory Lab
dba Archivers Annex
dba Archivers - The Photo Memory Store
6110 Golden Hills Drive
Golden Valley, MN 55416
Bankruptcy Case No.: 13-42153
Chapter 11 Petition Date: April 29, 2013
Court: United States Bankruptcy Court
District of Minnesota (Minneapolis)
Judge: Gregory F. Kishel
Debtor's Counsel: Michael L. Meyer, Esq.
RAVICH MEYER KIRKMAN MCGRATH NAUMAN
4545 IDS Center
80 South Eighth St.
Mineapolis, MN 55402
Tel: (612) 317-4745
E-mail: mlmeyer@ravichmeyer.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Jan L. Olsten, CEO.
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
EK Success Ltd. Trade debt $253,077
1125 West Taylor Road
Romeoville, IL 60446
American Express Trade debt $251,030
Company
Corporate Srvs
Operations
20022 No 31st Ave
AZ-08-03-11
Phoenix, AZ 85027
American Crafts Trade debt $202,241
476 North 1500 West
Orem, UT 84057
GGP-Glenbrook LLC Trade debt $180,820
In Retail Fund Trade debt $179,984
Algonquin Comm
Inland Comm'l Property
Mgmt
Inland Continental Trade debt $176,256
Prop Mgmt
3L Corporation Trade debt $127,272
We R Memory Keepers Trade debt $121,639
My Minds Eye LLC Trade debt $117,834
RPAI Southwest Trade debt $117,250
Management LLC
Bazzill Basics Paper Trade debt $114,732
Luv to Scrap LLC Trade debt $109,055
Doodlebug Design Trade debt $103,027
Bo-Bunny Press Trade debt $99,745
Ranger Industries Trade debt $79,869
Silhouette America Trade debt $78,297
Pioneer Photo Trade debt $76,431
Albums Inc.
Pink Paislee Trade debt $74,218
Queen & Company Trade debt $61,042
Ellison Trade debt $55,182
TOP SHIPS: Lowers Net Loss to $64-Million in 2012
-------------------------------------------------
Top Ships Inc. filed on May 1, 2013, its annual report on Form
20-F for the year ended Dec. 31, 2012.
Deloitte Hadjipavlou, Sofianos & Cambanis S.A., in Athens, Greece,
Expressed substantial doubt about Top Ships' ability to continue
as a going concern, citing the Company's recurring losses from
operations and stockholders' capital deficiency.
The Company reported a net loss of US$64.0 million on
US$31.4 million of total revenues in 2012, compared with a net
loss of US$189.1 million on US$80.6 million of total revenues in
2011.
The Company's balance sheet at Dec. 31, 2012, showed
US$211.4 million in total assets, US$198.3 million in total
liabilities, and stockholders' equity of US$13.1 million.
A copy of the Form 20-F is available at http://is.gd/jTCM4x
Located in Maroussi, Greece, Top Ships Inc. (Nasdaq: TOPS) is a
provider of international seaborne transportation services,
carrying petroleum products and crude oil for the oil industry and
drybulk commodities for the steel, electric utility, construction
and agriculture-food industries. As of May 1, 2013, its fleet
consists of seven owned vessels, including six tankers and one
drybulk vessel.
TRANSVANTAGE SOLUTIONS: In Chapter 11, Wants Ch.11 Trustee
----------------------------------------------------------
TransVantage Solutions, Inc., doing business as Freight Traffic
Services, filed a Chapter 11 petition (Bankr. D.N.J. Case No.
13-19753) in Trenton, New Jersey on May 4, and immediately filed a
motion for Chapter 11 trustee to take over management of the
Debtor.
"Various of the creditors of the Debtor made it clear they no
longer trust me to run the Debtor's business operations.
Therefore, I believe that it would be in the best interest of the
creditors if an independent trustee were to be appointed for this
purpose," Shirley Sooy, president of the Debtor, said in court
filings.
Branchburg, New Jersey-based TransVantage provides billing and
payment services to shippers or receivers of goods.
The Chapter 11 bankruptcy was filed when certain customers filed
lawsuits against the Debtor, and one of the customers froze the
Debtor's operating account. As a result, the Debtor was unable to
continue operations.
Ms. Sooy says the Debtor has a potential to satisfy claims of
various creditors through a Chapter 11 plan. The Debtors has
developed freight payment technology, which if properly
administered, marketed, and licensed can bring in significant sums
of money that can be used to fund a plan of reorganization, she
claims.
The Debtor disclosed assets of $71.3 million and liabilities of
$41.3 million in its schedules. The Debtor does not have any real
property, and its primary asset is a $71 million claim against
Johnson Controls. The Debtor says it does not have any secured
creditors. A copy of the schedules filed together with the
petition is available for free at:
http://bankrupt.com/misc/njb3-19753.pdf
John F. Bracaglia, Jr., Esq., at Cohn, Bracaglia & Gropper, serves
as counsel to the Debtor.
TRANSVANTAGE SOLUTIONS: Proposes Cohn Bracaglia as Counsel
----------------------------------------------------------
TransVantage Solutions, Inc., seeks approval from the Bankruptcy
Court to hire John F. Bracaglia, Jr., Esq., and the law firm of
Cohn, Bracaglia & Gropper, as counsel.
The firm will bill the Debtor at these hourly rates:
Professional
------------
John F. Bracaglia, Jr., Partner $325
Jill L. Gropper, Partner $325
Jill S. Carlson, Associate $215
Mr. Bracaglia discloses that the law firm in the past represented
the sole shareholder and president of the Debtor, and other
entities in which she has an interest. The only active
representation of the shareholder is a residential real estate
closing.
Mr. Bracaglia attests that the firm is disinterested under
11 U.S.C. Sec. 101(14).
About TransVantage Solutions
TransVantage Solutions, Inc., doing business as Freight Traffic
Services, filed a Chapter 11 petition (Bankr. D.N.J. Case No.
13-19753) in Trenton, New Jersey on May 4, and immediately filed a
motion for Chapter 11 trustee to take over management of the
Debtor.
Branchburg, New Jersey-based TransVantage provides billing and
payment services to shippers or receivers of goods. The Chapter 11
bankruptcy was prompted after customers filed lawsuits against the
Debtor, and one of the customers froze the Debtor's operating
account. As a result, the Debtor was unable to continue
operations.
TRINITY COAL: Can Hire D.J. Geiger as Mining Consultant
-------------------------------------------------------
Trinity Coal Corporation, et al., sought and obtained approval
from the U.S. Bankruptcy Court for the Eastern District of
Kentucky to employ D.J. Geiger & Co., LLC as mining consultant
effective as of March 25, 2013.
D.J. Geiger will provide management expertise skilled in mine
reclamation and mine operations consistent with regulatory
requirements and assist with the sale of assets in the Debtors'
Chapter 11 proceedings.
Subject to the Court's approval, D.J. Geiger & Co. will not be
required to file interim fee applications pursuant to Section 331
of the Bankruptcy Code and can be paid in accordance with the
consulting agreement. When its services are concluded, D.J.
Geiger & Co. will file a final fee application with the Court.
To the best of the Debtors' knowledge, D.J. Geiger is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Trinity Coal
Trinity Coal Corp. is a coal mining company that owns coal
deposits located in the Appalachian region of the eastern United
States, specifically, in Breathitt, Floyd, Knott Magoffin, and
Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo,
McDowell and Wyoming Counties in West Virginia.
Trinity's coal mining operations are organized into six distinct
coal mining complexes. Three complexes are located in Kentucky and
are referred to as Prater Branch Resources, Little Elk Mining and
Levisa Fork. The Kentucky Operations produced compliance and low
sulfur steam coal. Three complexes are located in West Virginia
and are referred to as Deep Water Resources, North Springs
Resources and Falcon Resources.
Trinity is a wholly owned subsidiary of privately held
multinational conglomerate Essar Global Limited.
Credit Agricole Corporate & Investment Bank, ING Capital LLC and
Natixis, New York Branch filed an involuntary petition for relief
under Chapter 11 against Trinity Coal Corporation and 15
affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three
entities say they are owed a total of $104 million on account
loans provided to Trinity.
On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and
Cecil I. Walker Machinery Co. filed an involuntary petition for
relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335)
against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit
Agricole, ING Capital and Natixis joined as petitioning creditors.
On March 4, 2013, the Debtors filed their consolidated answer to
involuntary petitions and consent to an order for relief and
reservation of rights, thereby consenting to the entry of an order
for relief in each of their respective Chapter 11 cases. An order
for relief in each of the Debtors was entered by the Court on
March 4, 2013, which converted the involuntary cases to voluntary
Chapter 11 cases.
TRINITY COAL: Panel Hires Foley & Lardner as Counsel
----------------------------------------------------
The Official Committee of Unsecured Creditors of Trinity Coal
Corporation, et al., asks the U.S. Bankruptcy Court for permission
to employ Foley & Lardner LLP as counsel.
Edward J. Green, Esq., attests that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.
The two attorneys presently designated to represent the Committee
and their current standard hourly rates are:
Professional Rates
------------ -----
Edward J. Green, Partner $780 per hour
Geoffrey S. Goodman, Partner $740 per hour
Mr. Green has agreed to discount his current standard hourly rate
by $200 per hour for this matter. Mr. Goodman has agreed to
discount his current standard hourly rate by $190 per hour for
this matter.
Mr. Green and Mr. Goodman have agreed to charge the following
rates for this matter for calendar year 2013:
Professional Rates
------------ -----
Edward J. Green, Partner $580 per hour
Geoffrey S. Goodman, Partner $550 per hour
About Trinity Coal
Trinity Coal Corp. is a coal mining company that owns coal
deposits located in the Appalachian region of the eastern United
States, specifically, in Breathitt, Floyd, Knott Magoffin, and
Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo,
McDowell and Wyoming Counties in West Virginia.
Trinity's coal mining operations are organized into six distinct
coal mining complexes. Three complexes are located in Kentucky and
are referred to as Prater Branch Resources, Little Elk Mining and
Levisa Fork. The Kentucky Operations produced compliance and low
sulfur steam coal. Three complexes are located in West Virginia
and are referred to as Deep Water Resources, North Springs
Resources and Falcon Resources.
Trinity is a wholly owned subsidiary of privately held
multinational conglomerate Essar Global Limited.
Credit Agricole Corporate & Investment Bank, ING Capital LLC and
Natixis, New York Branch filed an involuntary petition for relief
under Chapter 11 against Trinity Coal Corporation and 15
affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three
entities say they are owed a total of $104 million on account
loans provided to Trinity.
On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and
Cecil I. Walker Machinery Co. filed an involuntary petition for
relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335)
against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit
Agricole, ING Capital and Natixis joined as petitioning creditors.
On March 4, 2013, the Debtors filed their consolidated answer to
involuntary petitions and consent to an order for relief and
reservation of rights, thereby consenting to the entry of an order
for relief in each of their respective Chapter 11 cases. An order
for relief in each of the Debtors was entered by the Court on
March 4, 2013, which converted the involuntary cases to voluntary
Chapter 11 cases.
TRINITY COAL: Panel Hires Sturgill Turner as Attorneys
------------------------------------------------------
The Official Committee of Unsecured Creditors of Trinity Coal
Corporation, et al., asks the U.S. Bankruptcy Court for permission
to employ Sturgill, Turner, Barker & Moloney, PLLC as its
attorneys.
The Committee attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
Trinity Coal Corp. is a coal mining company that owns coal
deposits located in the Appalachian region of the eastern United
States, specifically, in Breathitt, Floyd, Knott Magoffin, and
Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo,
McDowell and Wyoming Counties in West Virginia.
Trinity's coal mining operations are organized into six distinct
coal mining complexes. Three complexes are located in Kentucky and
are referred to as Prater Branch Resources, Little Elk Mining and
Levisa Fork. The Kentucky Operations produced compliance and low
sulfur steam coal. Three complexes are located in West Virginia
and are referred to as Deep Water Resources, North Springs
Resources and Falcon Resources.
Trinity is a wholly owned subsidiary of privately held
multinational conglomerate Essar Global Limited.
Credit Agricole Corporate & Investment Bank, ING Capital LLC and
Natixis, New York Branch filed an involuntary petition for relief
under Chapter 11 against Trinity Coal Corporation and 15
affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three
entities say they are owed a total of $104 million on account
loans provided to Trinity.
On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and
Cecil I. Walker Machinery Co. filed an involuntary petition for
relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335)
against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit
Agricole, ING Capital and Natixis joined as petitioning creditors.
On March 4, 2013, the Debtors filed their consolidated answer to
involuntary petitions and consent to an order for relief and
reservation of rights, thereby consenting to the entry of an order
for relief in each of their respective Chapter 11 cases. An order
for relief in each of the Debtors was entered by the Court on
March 4, 2013, which converted the involuntary cases to voluntary
Chapter 11 cases.
UNIVERSAL FINANCE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Universal Finance, Inc.
223 Cooper Creek Drive
Suite 106
Mocksville, NC 27028
Bankruptcy Case No.: 13-50538
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Middle District of North Carolina (Winston-Salem)
Judge: William L. Stocks
Debtor's Counsel: Katherine J. Clayton, Esq.
P.O. Box 1800
Raleigh, NC 27602
Tel: (919) 839-0300
Fax: (919) 839-0304
E-mail: kclayton@brookspierce.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/ncmb13-50538.pdf
The petition was signed by Robert V. Green, director, shareholder.
US MORTGAGE CORP: NJ Court Narrows Claims v. NFS & JP Turner
------------------------------------------------------------
Bankruptcy Judge Rosemary Gambardella granted, in part, and
denied, in part, a motion to dismiss the second amended version
of the adversary complaint EDWARD P. BOND, as Liquidating Trustee
of U.S. Mortgage Corporation, Plaintiff v. NATIONAL FINANCIAL
SERVICES and JP TURNER & Co., LLC, Defendants, Adv. Proc. No.
11-1216(RG) (Bankr. D.N.J.).
The Trustee filed the complaint in February 2011, alleging five
counts against National Financial Services Inc. and J.P. Turner
& Co., LLC, that stem from the investment relationship between the
parties. An amended complaint was also filed on the same day.
Under the Complaint, the Trustee seeks to recover payment
transfers made to (i) the Defendants allegedly used to purchase
securities; (ii) reimburse the Defendants for securities
previously purchase; or (iii) pay the Defendants commissions on
behalf of one or more customers. The Trustee alleges that from
Feb. 9, 2006 to Oct. 6, 2008, the Debtors made payments to the
Defendants totaling $11,422,753. By way of a cross motion, the
Trustee has presented a proposed second amended complaint, which
further alleges that an additional transfer of not less than
$1,000,000 was made on Nov. 13, 2008.
J.P. Turner moved to dismiss the Amended Complaint. It also filed
a motion for summary judgment to establish that it is not a
transferee.
The Trustee, on the other hand, seeks authority to file its second
amended complaint.
After review of the proposed second amended complaint, the New
Jersey Bankruptcy Court finds that Count II to the extent it
asserts constructive fraudulent claims, Count III (Civil
Conspiracy), Count IV (Aiding and Abetting Civil Conspiracy and
Fraud), and Count V (Conversion) must be dismissed pursuant to the
safe harbor provision of 11 U.S.C. Sec. 546(e). The Court however
denies dismissal of Count I (Claim for Accounting) as it is not
prepared to rule as to whether a fidiuciary relationship was
present in the matter. The Court agrees with the Trustee that the
Trustee should be able to conduct discovery into the nature of the
parties' relationship.
Judge Gambardella also denies J.P. Turner's motion for summary
judgment. The Court finds that a genuine dispute as to material
facts surrounding the wire transfers, such as J.P. Turner's status
as a transferee or entity for whose benefit the transfers were
made, exists in the current matter.
Judge Gambardella also permits the Trustee to file its second
amended complaint no later than 30 days after the entry of the
recent Court order.
A copy of Judge Gambardella's April 23, 2013 Opinion is available
at http://is.gd/ZLkpiTfrom Leagle.com.
About U.S. Mortgage Corp. and CU National
U.S. Mortgage Corporation filed a voluntary Chapter 11 bankruptcy
petition (Bankr. D. N.J. Case No. 09-14301) on Feb. 23, 2009. Its
wholly owned subsidiary, C.U. National Mortgage, LLC, filed a
voluntary Chapter 11 bankruptcy petition (Bankr. D. N.J. Case No.
09-18104) on April 1, 2009. The Third Amended Joint Plan of
Liquidation was confirmed by the Bankruptcy Court on Oct. 26,
2009. Pursuant to the Liquidation Plan, a U.S. Creditors
Liquidating Trust was created for the benefit USM's and CUNM's
creditors and Anthony R. Calascibetta was appointed as the
Liquidating Trustee. On Feb. 1, 2012, Edward P. Bond, CPA, was
appointed as the Substitute Liquidating Trustee.
Judge Rosemary Gambardella presided over the Debtors' case.
Kenneth A. Rosen, Esq., and Bruce Buechler, Esq., at Lowenstein
Sandler PC, represented the Debtors. In its petition, CU National
estimated $1 million to $10 million in assets and $100 million to
$500 million in debts.
Former president and CEO Michael G. McGrath and Melissa A. McGrath
filed a Chapter 11 petition (Bankr. D. Mass. Case No. 10-20907) on
Oct. 4, 2010, estimating under $1 million in assets and debts. A
copy of the McGrath's petition is available at no charge at
http://bankrupt.com/misc/mab10-20907.pdf
USEC INC: To Submit NYSE Listing Compliance Plan
------------------------------------------------
USEC Inc. has been notified by the New York Stock Exchange that
the Company has fallen below the exchange's continued listing
standards related to minimum market capitalization in combination
with stockholders' equity.
The Company's common stock continues to trade on the NYSE. USEC
is below the continued listing criteria established by the NYSE
because the Company's market capitalization has averaged less than
$50 million in a recent consecutive 30 trading-day period at the
same time that stockholders' equity has been below $50 million.
USEC reported a stockholders' deficit of $472.9 million as of
December 31, 2012, following the expense of $1.1 billion of
previously capitalized work in process costs related to the
American Centrifuge project.
USEC has notified the NYSE that it will submit a plan to restore
compliance. The Company has 45 days from receipt of the April 30,
2013, notice from the NYSE to submit a plan, and the NYSE has 45
days from receipt of the plan to accept or reject it. If the plan
is accepted, the Company has up to 18 months to demonstrate
compliance with the NYSE continued listing standards. During this
18-month period, USEC common shares will continue to be listed and
traded on the NYSE, subject to continued periodic review by the
NYSE of USEC's progress with respect to its plan and compliance
with other NYSE continued listing standards.
The average closing price of the Company's common stock also
continues to be below the NYSE's continued listing criteria
relating to minimum share price. To cure this condition, the
Company intends to seek stockholder approval for a reverse stock
split at its next annual meeting of stockholders, scheduled for
June 27, 2013. If the Company's stockholders approve the reverse
stock split and USEC effectuates the reverse stock split to cure
the condition, the condition will be deemed cured if USEC's
closing share price promptly exceeds $1.00 per share, and the
price remains at or above that level for at least the following 30
trading days.
The financial results for the first quarter 2013 reflect a
reduction in separative work unit (SWU) revenue and lower gross
profit compared to the same period of 2012. Results include the
recognition of $47.6 million of other income from U.S. Department
of Energy (DOE) pro-rata cost sharing support for the research,
development and demonstration (RD&D) program, offset by increased
advanced technology costs. In addition, USEC completed the sale
of its subsidiary NAC International on March 15, 2013. The sale
and results of NAC operations through the date of divestiture are
presented under net income from discontinued operations. The March
31, 2013, cash balance was $71.9 million after repaying an $83.2
million term loan and an account payable to Russia of $209.8
Revenue
Revenue for the first quarter of 2013 was $320.4 million, a
decrease of $221.6 million or 41 percent compared to the same
quarter of 2012. Revenue from the sale of SWU for the quarter was
$290.2 million compared to $537.9 million in the same period last
year. The volume of SWU sales decreased 49 percent in the quarter
reflecting the variability in timing of utility customer orders
and the expected decline in SWU deliveries in 2013 compared to
2012. The average price billed to customers for sales of SWU
increased 5 percent reflecting the particular contracts under
which SWU were sold during the periods. Revenue from the sale of
uranium was $27.6 million in the first quarter of 2013 compared
with no sales in the first quarter of 2012. Revenue from the
contract services segment was $2.6 million in the first quarter of
2013 compared to $4.1 million in the same period of 2012,
reflecting reduced contract services performed for DOE and DOE
contractors and reserves of revenue of $0.8 million in the first
quarter of 2013 pending resolution of cost allocations to the
closeout of the cold shutdown contract. Revenue and costs for NAC
in both periods are included in discontinued operations.
Net Results from Continuing and Discontinued Operations
The net loss from continuing operations improved $5.6 million in
the three months ended March 31, 2013, compared to the
corresponding period in 2012, reflecting DOE's pro-rata cost
sharing support for the RD&D program included in other income,
partially offset by the after-tax effects of lower gross profits
and increased advanced technology costs.
Cash Flow
At March 31, 2013, USEC had a cash balance of $71.9 million
compared to $292.9 million at December 31, 2012, and $72.3 million
at March 31, 2012. Cash flow used by operations in the first
quarter of 2013 was $175.3 million, compared to cash flow provided
by operations of $47.7 million in the previous year's period.
Inventories declined $57.1 million in the three-month period due
to monetization of inventory produced in the prior year. Payment
of the Russian Contract payables balance of $209.8 million, for
deliveries in prior periods, was a significant use of cash flow in
the three months ended March 31, 2013.
Cash proceeds on the sale of NAC of $39.9 million were received in
the three months ended March 31, 2013. On April 23, 2013, an
additional $3.3 million in cash proceeds on the sale of NAC were
received representing the final remaining purchase price
adjustment.
On March 14, 2013, the Company amended its credit facility that
was scheduled to mature on May 31, 2013. The amended revolving
credit facility totals $110.0 million (including letters of credit
of up to $50.0 million or $25.0 million upon cessation of
enrichment at the Paducah GDP) and matures on September 30, 2013.
USEC also repaid the $83.2 million outstanding on the term loan
under its 2012 credit facility.
A copy of USEC Inc.'s earnings release for the quarter ended March
31, 2013 is available at http://is.gd/SIob1r
USEC Inc., a global energy company, is a supplier of enriched
uranium fuel for commercial nuclear power plants.
VINAYAK PROPERTIES: Sarasota Airport Holiday Inn in Ch. 11
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Vinayak Properties LLC, the owner of the Holiday Inn
Sarasota Airport hotel in Florida filed a petition for Chapter 11
protection (Bankr. M.D. Fla. Case No. 13-05672) on April 30 in
Tampa, Florida, listing assets of $10.2 million and debt totaling
$20.3 million.
According to the report, the property is near the
Sarasota/Bradenton International Airport. It was completed in
2009 and has 135 rooms. Secured creditors are listed as being
owed $13.5 million, with unsecured creditors' claims totaling
$6.7 million.
The report relates that financial problems were occasioned by
fewer flights into the airport and the city's decision not to
build a nearby convention center.
VINAYAK PROPERTIES: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Vinayak Properties, LLC
dba Holiday Inn Sarasota Airport
8009 15th Street East
Attn: Jiten Patel
Sarasota, FL 34234
Bankruptcy Case No.: 13-05672
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Middle District of Florida (Tampa)
Judge: Catherine Peek McEwen
Debtor's Counsel: Katie Brinson Hinton, Esq.
MCINTYRE, PANZARELLA, THANASIDES et al
6943 East Fowler Avenue
Tampa, FL 33617
Tel: (813) 899-6059
E-mail: katie@mcintyrefirm.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 together with the petition, is available for free
at http://bankrupt.com/misc/flmb13-5672.pdf
The petition was signed by Jiten Patel, managing member.
VITAMIN SHOPPE: S&P Assigns 'BB' CCR; Outlook Stable
----------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'BB'
corporate credit rating to North Bergen, N.J.-based parent Vitamin
Shoppe Inc. The outlook is stable.
In addition, S&P withdrew its 'BB' corporate credit rating on
subsidiary Vitamin Shoppe Industries Inc.
"The rating on Vitamin Shoppe Inc. reflects our view of the
company's "fair" business risk profile and "significant" financial
risk profile," said credit analyst Kristina Koltunicki.
"Our fair assessment of the business risk profile reflects Vitamin
Shoppe's strong market position as one of the largest players in
the highly competitive and fragmented nutritional supplements
industry, the depth and breadth of merchandise offered compared
with its competitors, and our expectation for revenue growth to
outpace the industry average. In our view, both organic and
strategic acquisitions over the next few years will lead to robust
revenue growth. In December 2012, the company announced the
acquisition of Super Supplements Inc., which we believe will add a
modest amount of revenue, EBITDA, and stores to the company's
existing operations. We expect Vitamin Shoppe will make small,
strategic acquisitions over the next few years, as we expect
industry consolidation to continue. Adjusted EBITDA margin
improved by approximately 110 basis points (bps) for the 12 months
ended Dec. 29, 2012, to 17.2% from 16.1% in 2011. The company's
maturation cycle of newly opened stores, moderate promotional
activity, and expectation for modest inflationary increases in the
next year should help mitigate cost pressures from raw materials
and higher expenses to support new store growth."
The stable outlook reflects S&P's expectation that credit
protection measures will continue to improve over the next 12
months, as S&P expects the company to grow organically. S&P also
expects small, strategic acquisitions over the next few years to
supplement organic growth.
S&P could lower the rating if credit metrics weaken because of
debt-funded, shareholder-friendly initiatives, leading to adjusted
debt leverage approaching the mid-3.0x area. As of fiscal year-
end 2012, debt would need to increase by approximately
$150 million for this scenario to occur. An alternative scenario
would include operating performance declines due to adverse
regulatory measures, negative publicity, or competitive pressures
such that EBITDA weakens by 25%. This could occur if revenue
growth slows to the low-single digits while the company also
experiences gross margin contraction by 200 bps.
S&P could consider an upgrade if credit ratios demonstrate further
improvement because of consistently strong same-store sales and
EBITDA growth that outpaces increases in operating lease
commitments. If positive operating performance enhances credit
metrics such that leverage improves to below 2x and the company
sustains this metric for several quarters, S&P could consider an
upgrade. For this to occur, sales growth would have to be in the
mid- to high-teens, and margins would have to expand by about 200
bps. This would lead to a reassessment of the financial risk
profile to intermediate.
VIVIANI FAMILY: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: The Viviani Family Limited Partnership
36235 Ridge Rd.
Willoughby, OH 44094
Bankruptcy Case No.: 13-13098
Chapter 11 Petition Date: April 30, 2013
Court: United States Bankruptcy Court
Northern District of Ohio (Cleveland)
Judge: Pat E Morgenstern-Clarren
Debtor's Counsel: Glenn E. Forbes, Esq.
COOPER & FORBES CO., LPA
166 Main St.
Painesville, OH 44077-3403
Tel: (440) 357-6211
E-mail: Bankruptcy@cooperandforbes.com
Scheduled Assets: $9,659,872
Scheduled Liabilities: $13,938,662
A list of the Company's 20 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/ohnb13-13098.pdf
The petition was signed by Carl Viviani, president of Carl J.
Viviani Company, general partner.
VPR OPERATING: Files Schedules of Assets and Liabilities
--------------------------------------------------------
VPR Operating LLC filed with the Bankruptcy Court for the Northern
District of California its schedules of assets and liabilities,
disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $7,400,000
B. Personal Property $6,000,000
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $11,105,135
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $13,910
----------- -----------
TOTAL $13,400,000 $11,119,045
VPR Operating, LLC, and three related entities sought Chapter 11
protection (Bankr. W.D. Tex. Lead Case No. 13-10599) in Austin
on March 29, 2013. VPR estimated assets and debts of at least
$50 million. Brian John Smith, Esq., at Patton Boggs LLP, serves
as the Debtor's counsel. Judge Craig A. Gargotta presides over
the case.
Privately owned VPR is an oil and gas company focused on acquiring
and developing assets in the domestic onshore basins of the United
States. It has 53 producing wells, which generate revenue of
approximately $375,000 per month on average after royalty
payments. VPR was founded in 2008, and maintains producing oil
and gas properties in Oklahoma and New Mexico.
WEST KENDALL: Can Pursue 2011 Suit v. Downrite, Fla. App. Ct. Says
------------------------------------------------------------------
The District Court of Appeal of Florida, Third District, reversed
a lower court order dismissing the complaint commenced by West
Kendall Holdings, LLC, et al. against Downrite Engineering
Corporation, et al., and remanded the case for further
proceedings.
The Appellate Court held that:
-- The bankruptcy court had entered a final decree under
11 U.S.C. Sec. 350 closing the jointly administered case
of West Kendall and 127 other related entities two months
before the filing of West Kendall's circuit court complaint
in Miami. The bankruptcy court's retention of jurisdiction
for certain limited purposes did not bar, as a matter of
law, West Kendall's prosecution of its claims.
-- Although the bankruptcy court approved a settlement
agreement between West Kendall and Downrite Engineering in
2009, that agreement did not conclusively bar the present
action. The agreement released Downrite Engineering from
liability through the January 2010 date of approval by the
bankruptcy court, but specifically excluded the later claims
asserted by West Kendall in its 2011 complaint.
-- West Kendall should have been given an opportunity to amend
before facing dismissal of count III.
The appellate case is West Kendall Holdings, LLC, etc. Apellant,
v. Downrite Engineering Corporation, etc., Appellee, Case No.
3D12-781. (Fla. App. Ct.) The order on the appeal is available at
http://is.gd/H75VV2from Leagle.com.
WINSTAR COMMS: IDT Files for Spin-Off of Spectrum Licenses
----------------------------------------------------------
IDT Corporation on May 6 disclosed that its subsidiary, Straight
Path Communications Inc., has filed a Form 10 Registration
Statement with the Securities and Exchange Commission, which
includes an information statement for IDT stockholders.
SPCI is a wholly-owned subsidiary of IDT, and holds IDT's
interests in Straight Path Spectrum, Inc., (f/k/a IDT Spectrum,
Inc.), and Straight Path IP Group, Inc., (f/k/a Innovative
Communications Technologies, Inc.). Straight Path Spectrum holds
629 spectrum licenses in the 39 GHz band. It is the largest
single holder of 39 GHz licensed auction spectrum in the United
States. It also holds 15 LMDS licenses in the 28 GHz band. These
licenses were originally acquired from the bankruptcy estate of
Winstar Communications. Straight Path IP Group owns a portfolio
of patents primarily related to communications over the Internet
and the licensing business related to those patents.
"Creating a single independent business entity to monetize our
intangible assets including the spectrum licenses we acquired from
Winstar Communications is the best option for our shareholders,"
said Howard Jonas, IDT's Chairman and Chief Executive Officer.
"Straight Path Communications will benefit from a dedicated
management team focused exclusively on realizing the upside
potential of these two intangible assets."
The spin-off is intended to be tax-free to IDT and its
shareholders. Prior to consummation of the spin-off, IDT expects
to receive a legal opinion as to the spin-off's tax-free status.
In connection with the spin-off, each IDT stockholder will receive
one share of SPCI Class A common stock for every five shares of
IDT Class A common stock and one share of SPCI Class B common
stock for every five shares of IDT Class B common stock.
As of April 30, 2013, there were a total of approximately 1.6
million shares of IDT Class A common stock, and approximately 21.2
million shares of IDT Class B common stock issued and outstanding.
No action is required by IDT stockholders to receive the shares of
SPCI common stock.
The Form 10 and related materials, including an information
statement, are available through the Securities and Exchange
Commission's website at: http://www.sec.gov/cgi-bin/browse-
edgar?action=getcompany&CIK=0001574460&owner=include&count=40
SPCI will apply to have the SPCI Class B common stock listed on
the NYSE MKT under the ticker symbol "STRP".
Shares of IDT Class B Common Stock will continue to trade on the
New York Stock Exchange under the symbol "IDT".
Investors are encouraged to consult with their financial advisors
regarding the specific implications of buying or selling IDT
common stock.
About IDT Corporation
Through its IDT Telecom division, IDT Corporation --
http://www.idt.net-- provides telecommunications and payment
services. IDT Telecom's retail products allow people to
communicate and share resources around the world while its carrier
services business is a global leader in wholesale voice
termination.
About Straight Path Communications Inc.
Straight Path Communications holds a significant number of FCC
licenses for commercial fixed wireless spectrum and a portfolio of
patents primarily related to communications over the Internet.
About Winstar Communications, Inc.
Based in New York, Winstar Communications, Inc., provided
broadband services to business customers. The company and its
debtor-affiliates filed for chapter 11 protection on April 18,
2001 (Bankr. D. Del. Case Nos. 01-01430 through 01-01462). As
part of their chapter 11 restructuring strategy, the Debtors sold
their domestic telecom assets to IDT Winstar Acquisition, Inc.
IDT later sold the Winstar Assets to GVC Networks, LLC, resulting
in the creation of GVCwinstar, a wholly owned subsidiary of GVC
Networks.
On Jan. 24, 2002, the Bankruptcy Court converted the Debtors'
cases to a Chapter 7 liquidation proceeding. Christine C. Shubert
serves as the Debtors' Chapter 7 trustee. The Chapter 7
trustee is represented by Fox Rothschild LLP and Kaye Scholer LLP.
When the Debtors filed for bankruptcy, they listed $4,975,437,068
in total assets and $4,994,467,530 in total debts.
In early 2009, the U.S. Court of Appeals for the Third Circuit
affirmed a ruling that required an Alcatel-Lucent SA unit to
return to the Chapter 7 trustee a $188.2 million loan payment it
accepted in 2000. As a business partner to the telecommunications
company, Lucent Technologies Inc. was an "insider" under U.S.
bankruptcy law and owes Winstar's trustee the money, the appeals
court said.
WNA HOLDINGS: S&P Affirms 'B' CCR & Rates $500 Million Debt 'B'
---------------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'B'
corporate credit rating on WNA Holdings Inc. The outlook is
stable.
At the same time, S&P assigned a 'B' issue-level rating (same as
the corporate credit rating) and a '3' recovery rating to WNA's
proposed $50 million revolving credit facility due 2018 and
$450 million first-lien term loan due 2020. The '3' recovery
rating indicates S&P's expectation of meaningful recovery (50% to
70%) in the event of a payment default. The ratings are based on
preliminary terms and conditions of the facilities.
S&P also assigned a 'CCC+' issue-level rating and a '6' recovery
rating to WNA's proposed $150 million second-lien term loan due
2020. The recovery rating indicates S&P's expectation of
negligible recovery (0% to 10%) in the event of a payment default.
The company plans to use proceeds along with equity contributions
from its sponsors and Par-Pak owners to purchase Par-Pak and to
refinance existing debt of about $331 million at WNA and Par-Pak,
and to use the remainder for fees and expenses.
"After the Par-Pak acquisition, we expect the ratio of total
adjusted debt to EBITDA to increase to about 6x from the low 5x
area and the ratio of funds from operations to total adjusted debt
to be in the 10% area," said Standard & Poor's credit analyst
Henry Fukuchi.
"Although we would continue to view the financial profile as
"highly leveraged," we expect favorable operating trends and a
gradually improving financial profile to support the current
ratings and the stable outlook. Based on our scenario forecasts,
we expect leverage to improve gradually to about 5x and FFO to
total adjusted debt to improve slightly to about 12% in the next
couple of years through improving operating trends and anticipated
synergies related to the acquisition. We expect FFO to total
adjusted debt to be in the 10% to 15% range, which we view as
consistent with the current ratings. The company has targeted
about $4 million in synergies related to purchasing benefits and
headcount reductions. We expect the company will be able to
realize a large portion of these synergies within the next year.
We believe the proposed acquisition will improve its market
position within the specialty segment particularly in the bakery,
produce, and school meal segments. While this acquisition
strengthens WNA's business risk profile modestly, we continue
to view the business risk profile as "weak", S&P noted
The ratings on WNA reflect its weak business risk profile based on
its very limited scope of operations as the leading manufacturer
in the premium niche of the injection-molded plastic food service
tableware, some vulnerability to fluctuating raw-material costs,
and a highly leveraged financial profile. The company's narrow
business focus is partially offset by a favorable product mix in
the domestic tableware segment, well-established customer
relationships, and attractive operating margins.
The outlook is stable. WNA's decent market positions in certain
niche segments of the domestic disposable food service products
market and solid customer relationships support the ratings.
These positives should help to offset the company's limited sales
base and the impact on operating margins from volatility in high
raw-material costs or lower-than-expected sales growth due to
economic concerns. The company's high debt leverage and limited
scope of operations limit upside ratings potential.
Based on the downside scenario S&P is forecasting, it could lower
the ratings if operating margins weaken by more than 2% or if
volumes decline 15% or more from current levels. In S&P's
downside scenario, total adjusted debt to EBITDA would deteriorate
to more than 6x and FFO to total adjusted debt would decrease to
the mid-to-high-single-digit percentage area. S&P may also lower
the ratings if unexpected cash outlays or business challenges
reduce the company's liquidity position, or if covenant cushions
tighten to less than 10%.
Although S&P do not expect to do so, it could raise the rating
slightly if profitability continues to improve while liquidity
remains healthy. S&P could raise the ratings if FFO to total
adjusted debt remains over 15% through a business cycle and
prospects remain stable over time. This would also require an
understanding that financial policies would be supportive of a
higher rating.
WOOTON GROUP: Chapter 11 Status Conference Continued to June 19
---------------------------------------------------------------
Wooton Group, LLC, Investors Warranty of America, Inc., the first
priority lienholder on the Debtor's rental property located at
2945 S. Angus Road Fresno, Calif., and first priority lienholder
on the Debtor's rental property located at 3001 Navone Road,
Stockton, Calif., and Citizens Business Bank, the second priority
lienholder on the Navone Property, have stipulated and agreed on a
fifth continuance of the status conference and hearings on the
Debtor's disclosure statement and the Debtor's motion for
authority to use cash collateral and a fourth continuance of the
hearings on the Debtor's motion for an order disallowing portions
of the Proof of Claim No. 3 of Citizens and the Debtor's motion
for an order disallowing portions of the Proof of Claim No. 4 of
Investors, from May 1, 2013, at 10:00 a.m., to June 19, 2013, at
10:00 a.m.
According to papers filed with the Court, the additional time will
permit Investors and the Debtor to document and complete the terms
of their settlement, and seek Court approval thereof, and for
Debtor and Citizens to continue their settlement efforts.
The response deadline for the claim objections will be continued
to June 5, 2013. The Debtor's reply will be due by June 12,
2013.
The Debtor is authorized to continue use of cash collateral in
accordance with the terms and conditions of the Nov. 21, 2012 cash
collateral order. The Debtor is not permitted to use surplus cash
collateral from the Navone Property to make adequate protection
payments to Investors on its claim secured by the Angus Property.
About Wooton Group
Beverly Hills, Calif.-based Wooton Group, LLC, filed a bare-
bones Chapter 11 petition (Bankr. C.D. Cal. Case No. 12-31323)
in Los Angeles on June 19, 2012. Judge Thomas B. Donovan oversees
the case. M. Jonathan Hayes, Esq., Matthew D. Resnik, Esq., and
Roksana D. Moradi, Esq., at Simon Resnik Hayes LLP, in Sherman
Oaks, Calif., represent the Debtor as counsel. The petition was
signed by Mark Slotkin, managing member. In its schedules, the
Debtor disclosed assets of $10,500,961 and debts of $7,227,376 as
of the petition date.
Wooton filed on Nov. 23, 2012, a Disclosure Statement explaining
its proposed Chapter 11 Plan. According to the disclosure
statement, the Plan may provide for the Debtor to reorganize by
continuing to operate, to liquidate by selling assets of the
estate, or a combination of both. The Debtor will fund the Plan
from the tenant income it receives from the lease of its real
property.
The Debtor will pay Investors Warranty its Class 2 obligation in
full. The Debtor will cure the arrearage, estimated to be
$75,000, on the Effective Date. The Debtor will otherwise pay
Investors according to the contract or interest at 5.64% with a
balloon payable on Nov. 1, 2025. The monthly payments will be
$24,757 per month. The Debtor will continue paying the monthly
adequate protection payment to Investors until the Effective Date
of the Plan.
The Debtor will pay Citizens Bank its Class 3 obligation in full.
Until paid in full, the secured claim will bear interest at 6%.
The claim shall be amortized over a period of 30 years from the
Effective Date, with a balloon payment of all unpaid principal and
all accrued but unpaid interest on Dec. 31, 2018. The monthly
payments will be $9,593 per month, starting on the first day of
the first month following the Effective Date, estimated to be
March 1, 2013. The Debtor will continue paying the monthly
adequate protection payment to Citizens until the Effective Date
of the Plan.
Holders of Class 6 Allowed General Claims will be paid in full 30
days after the Effective Date. Class 7 (Un secured Claims ?
Tenant Deposits) will be paid in full according to the terms of
the deposit agreement reached with each tenant.
The Members of the Debtor (Class 8) will retain their interests in
the Debtor.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/wooton.doc70.pdf
XCELL ENERGY: Committee Can Hire Burr & Forman as Counsel
---------------------------------------------------------
The Official Committee of Unsecured Creditors in the Xcell Energy
and Coal Company LLC bankruptcy case sought and obtained
permission from the Hon. Tracey N. Wise of the U.S. Bankruptcy
Court for the Eastern District of Kentucky to employ Burr & Forman
LLP as counsel, nunc pro tunc to March 6, 2013.
Burr & Forman will, among other things, assist the Committee in
its investigation of the acts, conduct, assets, liabilities,
financial conditions of the Debtor, the operation of the Debtor's
business, and any other matter relevant to this case at these
hourly rates:
Partners $250 to $415
Associates $225 to $300
Paralegals $125 to $180
To the best of the Committee's knowledge, Burr & Forman is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
Burr & Forman can be reached at:
Derek F. Meek, Esq.
James H. Haithcock, III, Esq.
Ellen C. Rains, Esq.
BURR & FORMAN LLP
420 North 20th Street, Suite 3400
Birmingham, AL 35203
Tel: (205) 251-3000
(800) GET-BURR (Toll-Free)
Fax: (205) 458-5100
E-mail: dmeek@burr.com
jhaithco@burr.com
erains@burr.com
About Xcell Energy
Xcell Energy and Coal Company, LLC, and its parent Energy
Investment Group, LLC, sought Chapter 11 protection (Bankr. E.D.
Ky. Case Nos. 13-70095 and 13-70096) on Feb. 14, 2013 in
Pikeville, Kentucky.
The Debtors sought bankruptcy after lender Alpha Credit Resources
LLC, owed $8 million, sought a receiver in state court and
scheduled a foreclosure auction on Xcell.
The Debtor is represented by attorneys at DelCotto Law Group PLLC
in Lexington, Kentucky.
Xcell Energy estimated assets and debts in excess of $10 million.
XCELL ENERGY: Can Hire Litzler Segner as Accountant
---------------------------------------------------
Xcell Energy and Coal Company LLC sought and obtained approval
from the U.S. Bankruptcy Court to employ Litzler, Segner, Shaw &
McKenney LLP as Accountant.
Xcell Energy and Coal Company, LLC, and its parent Energy
Investment Group, LLC, sought Chapter 11 protection (Bankr. E.D.
Ky. Case Nos. 13-70095 and 13-70096) on Feb. 14, 2013 in
Pikeville, Kentucky.
The Debtors sought bankruptcy after lender Alpha Credit Resources
LLC, owed $8 million, sought a receiver in state court and
scheduled a foreclosure auction on Xcell.
The Debtor is represented by attorneys at DelCotto Law Group PLLC
in Lexington, Kentucky.
Xcell Energy estimated assets and debts in excess of $10 million.
ZACKY FARMS: Poultry Farms Plan Set for June 25 Approval
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that unsecured creditors of Zacky Farms LLC stand to
recover as little as 5 percent or as much as 24 percent, assuming
the former vertically integrated poultry producer wins court
approval of a liquidating Chapter 11 plan at a June 25
confirmation hearing in U.S. Bankruptcy Court in Sacramento,
California.
The report notes that the plan is the result of an on-again, off-
again sale in January and February where the Zacky family trust
eventually ended up buying back the business. After the sale, the
bankrupt company changed its name to ZF in Liquidation LLC.
According to the report, the ultimately-approved sale had the
family trust buy the business in exchange for $2.9 million cash,
the assumption of $500,000 in tax liabilities, and $9.9 million in
notes. One note for $6.4 million pays creditors who supplied
goods within 20 days of bankruptcy. The second note, for $3.5
million, is for unsecured creditors.
The bankrupt company has $2.74 million in cash, according to the
disclosure statement approved May 3. There are up to $32 million
in unsecured claims, including about $17.5 million asserted by
Zacky family members.
If the Zacky claims are knocked out, the expected distribution
for unsecured creditors will range from 18 percent to 24 percent.
If the Zacky claims stand, the distribution will be 5 percent to
10 percent, according to the disclosure statement.
About Zacky Farms
Fresno, California-based Zacky Farms LLC, whose operations include
the raising, processing and marketing of poultry products, filed
for Chapter 11 bankruptcy protection (Bankr. E.D. Cal. Case No.
12-37961) on Oct. 8, 2012 in Sacramento. The company has roughly
1,000 employees and operates in multiple plants, farms and offices
in California, including operations in Los Angeles, Fresno,
Tulare, Kings, San Joaquin and San Bernardino Counties. The
company blames high feed prices for losses in recent years. The
Debtor disclosed $72,233,554 in assets and $67,345,041 in
liabilities as of the Chapter 11 filing.
The Company has plans to sell itself to pay creditors. Zacky
Farms LLC received bankruptcy-court approval to sell its assets to
the Robert D. and Lillian D. Zacky Trust.
Kurtzman Carson Consultants LLC will provide administrative
services and FTI Consulting, Inc., serves as the Debtor's Chief
Restructuring Officer. Bankruptcy Judge Thomas Holman presides
over the case. The petition was signed by Keith F. Cooper, the
Debtor's sole manager.
An official committee of unsecured creditors has been appointed in
the case. Lowenstein Sandler represents the Committee. The
Lowenstein team includes Kenneth A. Rosen, Bruce S. Nathan,
Jeffrey D. Prol, Wojciech F. Jung and Keara Waldron.
The Debtor's DIP lender, The Robert D. Zacky and Lillian D. Zacky
Trust U/D/T dated July 26, 1988, is represented by Thomas Walper,
Esq., at Munger Tolles & Olson LLP; and McKool Smith LLP.
ZHONE TECHNOLOGIES: Reports $230,000 Net Income in 1st Quarter
--------------------------------------------------------------
Zhone Technologies, Inc., filed its quarterly report on Form 10-Q,
reporting net income of $230,000 on $28.4 million of net revenue
for the three months ended March 31, 2013, compared with a net
loss of $3.4 million on $27.1 million of net revenue for the same
period last year.
The Company recorded a $600,000 credit to its statement of
comprehensive income in the current period as a result of a vendor
refund received in 2013 which related to overpayments for health
benefits made in 2012.
The Company's balance sheet at March 31, 2013, showed
$60.3 million in total assets, $28.1 million in total liabilities,
and stockholders' equity of $32.2 million.
The Company said: "Although the Company generated net income in
the fourth quarter of 2012 and the first quarter of 2013, the
Company incurred a net loss for the year ended Dec. 31, 2012, and
expects that operating losses may continue in 2013. As of
March 31, 2013, the Company had approximately $11.7 million in
cash and cash equivalents and $10.0 million in current debt
outstanding under its revolving line of credit and letter of
credit facility with Wells Fargo Bank ("WFB"). The Company
currently expects to repay the WFB Facility within the next twelve
months."
A copy of the Form 10-Q is available at http://is.gd/R9plYl
Zhone Technologies, Inc., designs, develops and manufactures
communications network equipment for telecommunications, wireless
and cable operators worldwide. The Company's products allow
network service providers to deliver video and interactive
entertainment services in addition to their existing voice and
data service offerings. The Company was incorporated under the
laws of the state of Delaware in June 1999. The Company began
operations in September 1999 and is headquartered in Oakland,
California.
ZUERCHER TRUST: Ch.11 Trustee Can Hire Ezra Brutzkus as Counsel
---------------------------------------------------------------
Peter S. Kravitz, Chapter 11 Trustee for The Zuercher Trust of
1999, has sought and obtained authorization from the U.S.
Bankruptcy Court for the Northern District of California to employ
the law firm of Ezra Brutzkus Gubner LLP as his general bankruptcy
counsel effective Jan. 31, 2013.
Ezra Brutzkus will, among other things, investigate and recover
potential proceeds allegedly to be disbursed from a related
bankruptcy case and assist in the protection of assets of the
estate. The firm's hourly rates are:
Robert Ezra, Partner $625
Mark D. Brutzkus, Partner $550
Steven T. Gubner, Partner $625
Richard Burstein, Partner $550
Glenn A. Fuller, Partner $475
J. Alison Grabell, Partner $475
Jeffrey A. Kobulnick, Partner $475
Richard L. Mann, Partner $425
Gary Park, Partner $475
Nicholas Rozansky, Partner $495
David Seror, Partner $550
Robyn B. Sokol, Partner $525
Corey R. Weber, Partner $450
Ronald Abrams, Of Counsel $375
Larry Gabriel, Of Counsel $595
Racey Cohn, Of Counsel $420
Daniel H. Gill, Of Counsel $495
Talin Keshishian, Of Counsel $425
Michele A. Seltzer, Of Counsel $395
Michael W. Davis, Associate $375
Darren Neilson, Associate $350
Joseph M. Rothberg, Associate $325
Karla Bagley, Paralegal $230
Tina Dow, Paralegal $210
Kathy Pscion, Paralegal $175
Susan Robbins, Paralegal $220
Juanita Treshinsky, Paralegal $220
Lora Vorkink, Paralegal $220
Maria Abel, Paralegal $195
Sheri Broffman, Trademark Administrator $125
Kathy Pscion, Trustee Administrator $175
Litigation Support $125
Law Clerks $100
Daniel H. Gill, Esq., of counsel to the law firm Ezra Brutzkus,
attests to the Court that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
About The Zuercher Trust of 1999
San Mateo, California-based The Zuercher Trust of 1999 filed for
Chapter 11 bankruptcy (Bankr. N.D. Cal. Case No. 12-32747) on
Sept. 26, 2012. Bankruptcy Judge Thomas E. Carlson presides over
the case. Derrick F. Coleman, Esq., at Coleman Frost LLP, serves
as the Debtor's counsel.
The Debtor, a business trust, estimated assets and debts of
$10 million to $50 million. The Debtor owns property in
621 S. Union Avenue, in Los Angeles. The property is currently in
REAP for alleged city health code violations.
In its schedules, the Debtor disclosed $28,450,000 in total assets
and $12,084,015 in total liabilities.
The petition was signed by Monica H. Hujazi, trustee.
* JPMorgan Caught in Swirl of Regulatory Woes
---------------------------------------------
Jessica Silver-Greenberg and Ben Protess, writing for The New York
Times' DealBook, reported that government investigators have found
that JPMorgan Chase devised "manipulative schemes" that
transformed "money-losing power plants into powerful profit
centers," and that one of its most senior executives gave "false
and misleading statements" under oath.
According to the report, the findings appear in a confidential
government document, reviewed by The New York Times, that was sent
to the bank in March, warning of a potential crackdown by the
regulator of the nation's energy markets.
The possible action comes amid showdowns with other agencies, the
DealBook report related. One of the bank's chief regulators, the
Office of the Comptroller of the Currency, is weighing new
enforcement actions against JPMorgan over the way the bank
collected credit card debt and its possible failure to alert
authorities to suspicions about Bernard L. Madoff, according to
people who were not authorized to discuss the cases publicly.
In a meeting last month at the bank's Park Avenue headquarters,
the comptroller's office delivered an unusually stark message to
Jamie Dimon, the chief executive and chairman: the nation's
biggest bank was quickly losing credibility in Washington, the
DealBook recalled. The bank's top lawyers, including Stephen M.
Cutler, the general counsel, have also cautioned executives about
the bank's regulatory problems, employees say.
Mr. Dimon acknowledged in a recent letter to shareholders that
"unfortunately, we expect we will have more" enforcement actions
in "the coming months," the DealBook further recalled. He
apologized for letting "our regulators down" and vowed to "do all
the work necessary to complete the needed improvements."
* Multi-Corp Signs Deal to Purchase Double X Property
-----------------------------------------------------
Multi-Corp International Inc. has signed a LOI with Quad Energy
Corp. to purchase 100% working interest in the Double X property
for 3 million restricted shares of Multi-Corp International Inc.
The terms of the transaction are as follows, Quad Energy Corp. has
been in negotiations with the US Federal government and bankruptcy
court since December 2010. This transaction was sanctioned by the
bankruptcy court with conditions. Once these conditions are met
Quad can deliver the property to Multi-Corp International. This
pending transaction between Quad and Multi has been approved by
the bankruptcy court as of March 28, 2013.
Double X consists of 1480 acres of land holdings with 14
producible wells. The wells are capable of producing 38 BOPD.
Production is from the Delaware formation. There is also
sufficient acreage to drill 21 new wells. The Double X site is
production ready with all pump jacks and infrastructure ready to
go. This property has a past record of producing over 660,000
bbls oil and 1,207,026 mcf of hydrocarbon production.
About Multi-Corp International, Inc.
Multi-Corp International is an Exploration and Production (E&P)
company focused on delivering superior operating and financial
results by developing and acquiring oil and gas resources
initially in New Mexico and then throughout North America.
* Regulators Scrutinize Auto Lenders over Add-Ons
-------------------------------------------------
Robin Sidel and Alan Zibel, writing for The Wall Street Journal,
reported that the Consumer Financial Protection Bureau has issued
subpoenas to U.S. auto lenders over the sale of extended
warranties and other financial products, according to people
familiar with the investigation, expanding a civil probe that
lenders say could slow the booming car-loan industry.
According to the WSJ report, any new restrictions could affect
millions of Americans who use loans to buy new and used vehicles
each year. Add-on products, such as extra insurance, are a popular
mechanism used by car dealers to boost profits.
Though such products are legal, regulators are probing whether
terms and prices are adequately disclosed, the WSJ report related.
The CFPB has pursued a similar strategy with credit-card
companies, fining them over the use of deceptive marketing
practices to sell products like identity-theft protection.
The Justice Department, meanwhile, is probing auto dealerships
that make their own loans to customers with poor credit and charge
higher rates, Jon Seward, deputy chief of the department's housing
and civil-enforcement section, said at a panel discussion at
George Mason University on Thursday, WSJ related. The government
plans action this year, said Mr. Seward, who declined further
comment.
The probes are the latest efforts by regulators to rein in what
they see as questionable auto-lending practices, according to WSJ.
The CFPB in March warned that lenders should revamp deals with
auto dealers that allow them to boost interest rates on customers
with low credit scores, a practice that consumer advocates say is
discriminatory against African-Americans and Hispanics.
"Companies should be able to compete without illegally charging
consumers more for a car loan because of their race or gender," a
CFPB spokeswoman told WSJ.
* S&P Predicts No More Calif. Municipalities Bankruptcies
---------------------------------------------------------
Jim Christie, writing for Reuters, after California stunned the
$3.7 trillion municipal debt market last year with three
bankruptcy filings, analysts at Standard & Poor's do not expect
any more -- this year.
According to the Reuters report, local government finances in
California are improving and concerns of more municipal
bankruptcies popping up in the most populous U.S. state are
overdone, said S&P analysts, speaking on Wednesday on the
sidelines of the annual National Federation of Municipal Analysts
conference in San Diego.
So far this year there have been no signs of potential muni
bankruptcies, S&P analyst Gabriel Petek told Reuters, while S&P
analyst Matthew Reining said that "We believe most credits are
doing quite well."
S&P's David Hitchcock added that local revenues should pick up as
California's housing markets improve, the Reuters report related.
He also said that despite the growing attention to rising pension
spending local governments should be able to manage it.
Bondholders and bond insurers are particularly concerned about its
plan to maintain its pension payments to the California Public
Employees' Retirement System while trying to impose losses, or so-
called haircuts, on city debt in their portfolios, Reuters said.
* Illinois House Passes Sweeping Pension Fix in Close Vote
----------------------------------------------------------
JoAnne von Alroth, writing for Reuters, reported that the Illinois
House of Representatives in a 62 to 51 vote on Thursday passed a
comprehensive bill aimed at addressing the nation's most under
funded state pension plan, a major step after weeks of legislative
maneuvering had made pensions the dominant political issue in the
financially strapped state.
According to the Reuters report, the bill, introduced only two
days ago by the powerful Democratic House Speaker Michael Madigan,
now goes to the state Senate. That chamber's president is
preparing a competing plan that is viewed as more favorable to the
state's public-employee labor unions.
The Madigan bill, which is designed to eliminate a $96.8 billion
funding shortfall over 30 years, relies on changes to retirement
benefits that unions say are a violation of the state
constitution, the Reuters report said. Union leaders have said
they will challenge the measure in court if it becomes law, and
Madigan acknowledged during floor debate Thursday that
implementation likely would not move forward until courts rule on
the constitutional issue.
"In my judgment, this is a critical action that must be taken now.
Must be taken for future budget making. Must be taken for the
fiscal well-being and reputation of the state of Illinois,"
Madigan told Reuters during a floor debate prior to the bill's
passage. Madigan won the votes of two-thirds of the Democrats,
with 40 of them voting for it and 28 against, while Republicans
split nearly evenly, 22 for and 23 against.
* SAC to Begin Clawing Back Compensation in Insider Trading Cases
-----------------------------------------------------------------
Peter Lattman, writing for The New York Times' DealBook, reported
that Steven A. Cohen, the founder of the hedge fund SAC Capital
Advisors, sat for a deposition in a lawsuit in 2011 and
acknowledged that he was unfamiliar with his firm's compliance and
ethics policies on insider trading.
"I've read the compliance manual, but I don't remember exactly
what it says," Mr. Cohen said, according to a transcript of the
testimony, the DealBook report related.
On Thursday, Mr. Cohen sought to convince SAC investors and
regulators that he takes compliance seriously, the report said. In
a letter to his investors, Mr. Cohen announced a broad set of
changes that would bolster the fund's compliance practices,
including clawing back the pay of employees who violate the law.
"These reforms send an unmistakable message: We have zero
tolerance for wrongdoing and if you are caught breaking the rules,
it will cost you," Mr. Cohen wrote in the letter, the DealBook
cited. "This problem is our problem to solve. It's my name on the
door and we will solve it."
Mr. Cohen's letter comes as he fights to hold on to his investors,
who must soon decide whether to withdraw their money as a criminal
investigation continues into improper trading at the $15 billion
fund, according to DealBook. Last week, the firm extended a May
15 deadline for withdrawals for an additional three months.
Earlier this year, investors withdrew $1.7 billion, or about 25
percent of its outside money, the report related. (The rest of
SAC's funds -- about $9 billion -- is mostly Mr. Cohen's.)
SAC is adopting these measures as federal prosecutors continue to
press criminal cases against two former SAC employees -- Mathew
Martoma and Michael S. Steinberg -- and the fund awaits final
approval of a record $602 million civil settlement with securities
regulators related to one of those cases, the report said.
* SEC Zeroing In on "Prime" Funds
---------------------------------
Andrew Ackerman, writing for The Wall Street Journal, reported
that U.S. securities regulators, under pressure to address risks
posed by the $2.6 trillion money-market-mutual fund industry, are
considering a scaled-back approach that would tighten rules for
about half of the sector that is seen as most vulnerable to
investor runs, according to people familiar with staff
discussions.
According to the WSJ report, the approach, one of several being
contemplated at the Securities and Exchange Commission, would
require only the riskiest funds to abandon their fixed $1 share
price and allow shares to float in value like other mutual funds,
these people said.
Such a move would be a win for the industry, which balked at last
year's effort to require money managers to float all of their
funds' share prices or have the funds post banklike capital, WSJ
said. The SEC abandoned that approach after then-SEC Chairman Mary
Schapiro was unable to secure enough votes.
The ability to resolve long-standing concerns about money funds is
a crucial early test for SEC Chairman Mary Jo White, who is under
pressure from U.S. and global regulators to fix structural issues
that encourage investors to sell their shares quickly during times
of stress, WSJ noted.
Ms. White is expected to touch on the issue in her first public
speech Friday before the Investment Company Institute, a mutual-
fund trade group, the report related.
The SEC discussions could help pave the way for agreement among
the agency's five commissioners, since it would address the
riskiness of money funds in a way that is more palatable to the
industry and the commissioners who opposed last year's plan,
according to WSJ.
The SEC staff is discussing requiring only funds deemed most at
risk of investor stampedes to switch to a floating share price, on
the grounds that it would train investors to realize their
investments will fluctuate in value without causing them to bolt
in times of stress, WSJ said.
* April Bankruptcies in U.S. Showing Bottom or Uptick
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that bankruptcy filings in the U.S. during April continue
suggesting a bottom or a slight uptick.
The 101,000 bankruptcies of all types in April were the most on a
daily basis since May 2012. The filings were 7.4 percent more than
March although 7.6 percent fewer than April 2012, according to
data compiled from court records by Epiq Systems Inc.
Over the first four months of this year, total bankruptcies are
down 14 percent from the same period of 2012. The same holds for
commercial bankruptcies of all types, with last month's 4,350
filings the most since November.
The pattern is the same for Chapter 11, where larger companies
reorganize or sell assets. In April the almost 900 Chapter 11
filings were the most since May 2012.
States with the most bankruptcies in April per capita were
Tennessee, Georgia, and Alabama, the same as March. Earlier this
year Georgia replaced Alabama to take second place.
Bankruptcies throughout the U.S. declined 14.1 percent in 2012,
totaling 1,185,000. In 2011, there were 1,380,000. So far this
year, filings total almost 365,000. The 2011 bankruptcies
represented an 11.7 percent decline from the 1.56 million in 2010,
the most bankruptcies since the all-time record of 2.1 million set
in 2005. In the last two weeks before the bankruptcy laws
tightened in 2005, 630,000 Americans sought bankruptcy protection.
Yogita Patel at Daily Bankruptcy Review, citing a report from the
American Bankruptcy Institute, says that the number of companies
that filed for bankruptcy dipped 16% in April as businesses
continued to adjust their balance sheets to respond to stricter
lending standards, low interest rates and depressed consumer
spending.
* 9th Cir. Joins Circuit Split on Recharacterization Power
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in San Francisco overruled
a 27-year old precedent from that circuit's Bankruptcy Appellate
Panel and ruled that bankruptcy courts have power to utilize state
law for recharacterizing a loan as equity.
The report notes that last week's decision could be the case going
to the U.S. Supreme Court for resolution of the circuit split over
whether and by what standard bankruptcy courts can recharacterize
debt as equity. Some circuits authorize using general equitable
principles while others require use of state law.
Mr. Rochelle recounts that in a 1986 case named Pacific Express,
the Ninth Circuit appellate panel held that a bankruptcy court
only had power to subordinate a debt under Section 510 of the
Bankruptcy Code and had no power to recharacterize debt as equity.
According to the report, last week Circuit Judge Sandra S. Ikuta
overruled Pacific Express and adopted the position taken by the
U.S. Court of Appeals in New Orleans in a case called Lothian Oil.
The Ninth Circuit in San Francisco now holds that the Bankruptcy
Code allows bankruptcy courts to recharacterize a loan as debt
using state law.
Mr. Rochelle reports that the Ninth Circuit, joining in an
existing disagreement among the circuit courts, differed with the
Sixth Circuit in Cincinnati, from a case called Autostyle, where
recharacterization could be accomplished using general equitable
authority under Section 105 of the Bankruptcy Code. The San
Francisco court sees the Supreme Court's Butner decision as
requiring use of state law in determinations about the validity of
state-law based claims.
The case is Official Committee of Unsecured Creditors v.
Hancock Park Capital II LP (In re Fitness Holdings International
Inc.), 11-56677, U.S. Ninth Circuit Court of Appeals (San
Francisco).
* Cadwalader Appoints New Partners to Financial Restructuring Team
------------------------------------------------------------------
Cadwalader, Wickersham & Taft LLP on May 6 disclosed that Gregory
M. Petrick, head of the firm's European and Asian Restructuring
Practice and currently Managing Partner of the London office, and
Mark C. Ellenberg, a Partner in the Restructuring Practice, have
been named Co-Chairs of Cadwalader's Financial Restructuring
Department. Both are long-serving, senior members of Cadwalader's
Restructuring Department. The firm also announced that Holly
Neavill and Louisa Watt have joined the Financial Restructuring
team as Partners in the London office.
"It is a pleasure to announce the ascension of Greg and Mark to
the leadership positions of Co-Chairs of the Financial
Restructuring Department at Cadwalader," said Christopher White,
Chairman. "In various capacities and over a long period of time,
they have been instrumental in leading and growing the practice."
Mr. Petrick has played key roles in the restructuring,
reorganization, sale and acquisition of businesses in the life
insurance, financial services, telecommunications, energy, real
estate, shipping, and hospitality industries. He has led cross-
border restructurings across Europe, Indonesia and Australia. In
the past year, Mr. Petrick has helped guide the growth of the
firm's London office, attracting numerous leading lawyers to the
practice.
"Financial restructuring is a vital component of the services
Cadwalader offers to its domestic and multinational clients on
both sides of the ocean," said Mr. Petrick. "The experience and
depth of talent in both New York and London will drive our cross-
border strategy going forward. We are pleased to be leading that
effort."
Mr. Ellenberg advises debtors and creditors in complex financial
restructuring, workout, and bankruptcy matters, including
LyondellBasell, Northwest Airlines, Lehman and Enron, among
others.
"It is a privilege to be named Co-Chair of the department," said
Mr. Ellenberg. "The complex challenges facing companies in
today's economy require the kind of skills and creativity for
which Cadwalader is well known. I look forward to working with my
friend and long-time colleague to direct those efforts."
Holly Neavill joins Cadwalader from Latham & Watkins LLP, where
she was a Partner in the London office. Ms. Neavill began her
legal career in the United States and moved to London in 2003.
She has significant experience with the legal systems and workout
procedures across Europe and in the United States, and has become
well-known in the London market for her dedication, technical
expertise and commercial approach. Ms. Neavill has worked on a
number of high profile restructurings and distressed M&A deals,
most recently leading the ad hoc committee of bondholders in the
award winning restructuring of SEAT Pagine Gialle, a publicly-
listed Italian directories business. Ms. Neavill is a graduate of
Boston University Law School.
Louisa Watt joins the firm as a debt and claims trading Partner in
the Restructuring Practice. She was previously at Richards Kibbe &
Orbe LLP, where she was a Partner in the London office. She is a
leading practitioner in the transfer of distressed debt and claims
in the secondary market within Europe, Asia and the United States,
and an active participant in the Loan Market Association. She has
extensive experience in advising clients on a range of bespoke
trading transactions, often involving multiple jurisdictions. She
began her career in 1999 at Weil, Gotshal and Manges LLP, and was
an associate at Orrick, Herrington & Sutcliffe LLP. She was
elected Partner at Richards Kibbe & Orbe in 2007, and became a
member of the firm's Executive Committee in 2011.
"The European market continues to present its challenges, with
creditors looking for practical and innovative solutions for
cross-border restructuring," Mr. Petrick said. "Holly and Louisa
have proven track records. They have built strong and unique
practices representing a range of institutions facilitating
restructurings, distressed M&A and trading transactions and are
leading authorities in this area. This is an exciting time of
growth for our restructuring practice, and these are the right
attorneys."
Cadwalader's Financial Restructuring Practice is a full-service,
multidisciplinary group comprising attorneys in the United States
and London. The team advises clients with interests in North
America, Europe, Asia, Latin America and Africa. The appointments
of Neavill and Watt further broaden the range of expertise within
the practice, which continues to grow following the recent hire of
Partner Yushan Ng and Special Counsel Karen McMaster, both from
Linklaters.
About Cadwalader, Wickersham & Taft LLP
Established in 1792, Cadwalader, Wickersham & Taft LLP, --
http://www.cadwalader.com-- serves a diverse client base,
including many of the world's leading financial institutions and
corporations in more than 50 countries. With offices in New York,
London, Charlotte, Washington, Houston, Beijing, Hong Kong and
Brussels, Cadwalader offers legal expertise in antitrust, banking,
business fraud, corporate finance, corporate governance, energy,
environmental, financial restructuring, health care, intellectual
property, litigation, mergers and acquisitions, private equity,
private wealth, real estate, regulation, securitization,
structured finance and tax
* Large Companies With Insolvent Balance Sheets
-----------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 121.1 (13.9) (11.2)
AK STEEL HLDG AKS US 3,906.1 (109.7) 604.0
AMC NETWORKS-A AMCX US 2,618.9 (882.4) 524.0
AMER AXLE & MFG AXL US 2,866.0 (120.8) 271.3
AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2)
AMERISTAR CASINO ASCA US 2,074.3 (22.3) (57.4)
AMR CORP AAMRQ US 23,852.0 (8,376.0) (2,465.0)
AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0
ANGIE'S LIST INC ANGI US 108.3 (0.1) 3.3
ARRAY BIOPHARMA ARRY US 128.4 (31.7) 64.0
ARTISAN PARTNERS APAM US 287.6 (315.5) -
AUTOZONE INC AZO US 6,662.2 (1,550.1) (1,108.4)
BERRY PLASTICS G BERY US 5,050.0 (313.0) 482.0
CABLEVISION SY-A CVC US 7,246.2 (5,626.0) (319.5)
CAESARS ENTERTAI CZR US 27,475.0 (560.0) 1,227.1
CAPMARK FINANCIA CPMK US 20,085.1 (933.1) -
CC MEDIA-A CCMO US 16,292.7 (7,995.2) 1,211.7
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CHINA XUEFENG EN CXEE US 0.0 (0.0) (0.0)
CHOICE HOTELS CHH US 546.0 (539.3) 56.8
CIENA CORP CIEN US 1,885.2 (78.6) 741.2
CINCINNATI BELL CBB US 2,872.4 (698.2) (51.9)
COMVERSE INC CNSI US 823.2 (28.4) (48.9)
DELTA AIR LI DAL US 45,068.0 (1,943.0) (5,427.0)
DIRECTV DTV US 20,555.0 (5,031.0) 13.0
DOMINO'S PIZZA DPZ US 478.2 (1,335.5) 76.8
DUN & BRADSTREET DNB US 1,991.8 (1,014.3) (129.3)
FAIRPOINT COMMUN FRP US 1,798.0 (220.7) 31.1
FERRELLGAS-LP FGP US 1,503.0 (42.3) (22.2)
FIFTH & PACIFIC FNP US 826.3 (170.2) (17.7)
FOREST OIL CORP FST US 2,201.9 (42.8) (101.2)
FREESCALE SEMICO FSL US 3,171.0 (4,531.0) 1,186.0
GENCORP INC GY US 1,385.2 (379.1) 32.0
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
GRAMERCY PROPERT GPT US 2,168.8 (251.8) -
HCA HOLDINGS INC HCA US 27,882.0 (8,012.0) 1,796.0
HOVNANIAN ENT-A HOV US 1,580.3 (481.2) 935.2
HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8)
HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8)
INCYTE CORP INCY US 330.4 (175.0) 173.4
INFOR US INC LWSN US 5,846.1 (480.0) (306.6)
INVIVO THERAPEUT NVIV US 16.1 (2.3) (3.2)
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2
JUST ENERGY GROU JE US 1,510.8 (273.1) (287.1)
JUST ENERGY GROU JE CN 1,510.8 (273.1) (287.1)
L BRANDS INC LTD US 6,019.0 (1,014.0) 667.0
LIN TV CORP-CL A TVL US 1,241.4 (88.3) (182.6)
LORILLARD INC LO US 3,749.0 (1,796.0) 1,158.0
MANNKIND CORP MNKD US 251.3 (110.7) (78.0)
MARRIOTT INTL-A MAR US 6,523.0 (1,377.0) (732.0)
MDC PARTNERS-A MDCA US 1,418.5 (12.4) (165.9)
MDC PARTNERS-A MDZ/A CN 1,418.5 (12.4) (165.9)
MEDIA GENERAL-A MEG US 734.7 (193.7) 38.1
MERITOR INC MTOR US 2,337.0 (1,014.0) 208.0
MERRIMACK PHARMA MACK US 149.0 (6.4) 89.8
MODEL N INC MODN US 42.2 (11.1) (14.5)
MONEYGRAM INTERN MGI US 4,892.0 (171.7) 14.1
MORGANS HOTEL GR MHGC US 583.6 (148.2) 110.7
MPG OFFICE TRUST MPG US 1,466.9 (518.3) -
NATIONAL CINEMED NCMI US 810.5 (356.4) 129.6
NAVISTAR INTL NAV US 8,531.0 (3,309.0) 1,517.0
NPS PHARM INC NPSP US 151.1 (54.6) 107.5
NYMOX PHARMACEUT NYMX US 1.8 (7.4) (1.9)
ORBITZ WORLDWIDE OWW US 834.3 (142.7) (247.7)
ORGANOVO HOLDING ONVO US 9.0 (27.4) 7.3
PALM INC PALM US 1,007.2 (6.2) 141.7
PDL BIOPHARMA IN PDLI US 280.0 (68.1) 172.5
PHILIP MORRIS IN PM US 37,418.0 (2,732.0) 2,152.0
PHILIP MRS-BDR PHMO11B BZ 37,418.0 (2,732.0) 2,152.0
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
QUALITY DISTRIBU QLTY US 510.5 (11.1) 88.5
RALLY SOFTWARE D RALY US 35.8 (1.1) 1.3
REGAL ENTERTAI-A RGC US 2,209.5 (698.6) (129.7)
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
RENTPATH INC PRM US 208.0 (91.7) 3.6
RESVERLOGIX CORP RVX CN 14.0 (20.2) (4.7)
REVLON INC-A REV US 1,241.9 (655.1) 152.9
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
SALLY BEAUTY HOL SBH US 1,969.9 (157.2) 637.4
SILVER SPRING NE SSNI US 494.3 (104.0) 60.1
SINCLAIR BROAD-A SBGI US 2,729.7 (100.1) (3.2)
SUPERVALU INC SVU US 11,034.0 (1,415.0) (1,380.0)
TAUBMAN CENTERS TCO US 3,302.5 (184.4) -
TESORO LOGISTICS TLLP US 363.2 (18.1) 11.1
TETRAPHASE PHARM TTPH US 14.1 (3.2) 3.7
THRESHOLD PHARMA THLD US 113.9 (21.8) 88.3
TOWN SPORTS INTE CLUB US 406.2 (50.7) (13.2)
ULTRA PETROLEUM UPL US 2,007.3 (577.9) (388.2)
UNISYS CORP UIS US 2,323.2 (1,545.4) 453.1
VECTOR GROUP LTD VGR US 1,086.7 (79.3) 443.9
VERISIGN INC VRSN US 2,071.1 (39.1) (91.2)
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
VISKASE COS I VKSC US 334.7 (3.4) 113.5
WEIGHT WATCHERS WTW US 1,218.6 (1,665.5) (229.9)
WEST CORP WSTC US 3,940.9 (850.2) 297.8
WESTMORELAND COA WLB US 943.0 (286.5) (3.0)
*********
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.
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